Well, the evidence is stacking up against the cute Flash animation I saw that was probably designed by some graphics dude who doesn't even own a car, muchless a car stereo.

Assuming that's the case... where do we go from here? If applying large negative or possitive gains on any band will result in those bands overlapping, we should try to apply moderate gain (both possitive and negative) centering around the 0dB point. Yet, this inevidably causes us to apply possitive gain to our EQ which in turn, can result in clipping of the digital signal. What are we to do?

The only solution I can think of from the top of my head is to set your input gain (on the amp) with your Volume set to -10dB. Then, any adjustments made to the EQ, even if you add upto 10dB to any band, will not clip the signal before it is sent to the proc-amp. Am I getting this right?

That solution seems like it "would work" but we won't be getting the best signal to noise ratio (yet I doubt we'd notice). My main problem with it is that we'd have to remember that -10dB would be the highest we could set the volume without clipping. That's just ugly. Yet, if the input gain was properly set, I suppose we'd never have to raise the volume past -10dB without the music being too loud anyway...