[[The biggest problem is (as you say) it robs the sound of dynamics and subtlety. The frequencies that suffer the most are the midrange and treble.]]
Yep, that was exactly my experience with the DEQ2496. And I _really_ wanted a digital EQ/room correction solution for my system.
I pulled it out of the closed and tried it again this week. Nope, back in the closet it goes . :(