How important is setting the absolute maximum peak input level?

[lovingdvd]

According to what I have read, when setting up the BFD it should be at the -10db input and set up so that at the maximum listening volume, the output level of the sub from the AVR should be set so that the maximum deepest bass causes the BFD red light to come on for no more than a flicker here and there.

And if I understand correctly, its equally important that the output level from the AVR is not too low, otherwise this introduces distortion.

What I am wondering, however, is just how important it is to really find that maximum peak level. Lets say that I had my AVR set so that at the maximum level the top green LED came on but orange did not or barely flickered (instead taking it up to red). In that scenario would I likely notice ANY difference in sound quality from my sub (assuming the sub gain was then adjusted to compensate for the proper level calibration)?

I ask because I have a bit of an issue where my PS3 Blu Ray output LFE is about 8db stronger than my Toshiba XA2 HD DVD player - not sure why. But none the less I've compensated for this by using a -8db trim on the LFE only when playing the Blu Ray.

However I also needed to drop the output level from the AVR a bit to still keep it from clipping into the red. So things are nearly perfect now with the PS3 but with the XA2 the signal from the AVR is a bit lower.

Normally I wouldn't think this would make a difference. However after making this change the deepest base from the Nine Inch Nails HD DVD sounded a bit distorted/muffled compared to when I had the AVR output set a few clicks higher. And all green LEDs are light and no orange/red so I know I'm not over driving it. Just curious why this may be happening? Could just a two clicks lower on the AVR's subwoofer output level make any noticeable difference?

Thanks!

[brucek]

What I am wondering, however, is just how important it is to really find that maximum peak level. Lets say that I had my AVR set so that at the maximum level the top green LED came on but orange did not or barely flickered (instead taking it up to red). In that scenario would I likely notice ANY difference in sound quality from my sub

No, you would not notice any difference.

brucek