The 50% hitpoint rule.
*SNIP*
So with all of those factors, here's my take home message: START SMALL!!
A 50% change in hitpoints is a huge alteration. Try 15%, 20%....and see how that goes. Run that for a while and see if its to your liking. The greater the change you make, the more likely other things will crop up you just didn't account for when running the numbers (like the points I mentioned...and others even I didn't think of).
Stalker0, thanks for the input. You make some excellent points here, and I'll take them into consideration as I continue running my game.
However, I've been running the 50% HP, + (1/2 level + 1) damage for about a month now, and I keep having the same thought over and over again:
On paper, it doesn't look like the monsters are doing enough damage... but IN GAME, ever battle is a knock down brawl where the players each spend at least 1-2 healing surges a battle, and usually 1 or 2 players drop or almost drop.
I can't imagine adding any more damage at this point. The problem, as you greatly explained, is the Burst damage. Players can take medium hits round after round, but there's a threshold that makes players drop too quickly.
Since my group is composed of primarily causal players who just want to have fun and get excited throwing some dice, my system works well. Even our tactician rules-lawyer RP-vet says the sessions have been a blast and feel balanced. Monsters die quicker, but hit harder (though on paper, not MUCH harder), and players are constantly dropping dangerously below Bloodied.
I'm not against adding more damage to the monsters to make the math balance... but I just see that being more frustrating to players than anything else.
Strangely, I make the same recommendation as you did towards the end of your post: try just shaving off 25% HP, or 33%. See how that goes.
I jumped straight to 50% for 2 reasons:
1. I SERIOUSLY needed to speed up combat with my group, and yelling at them to play FASTER wasn't going to work ;P
2. As a DM, it's easier for me to pull out any monster and "do the math"... just look at the Bloodied HP stat, and that's now its normal HP. On every attack, just add 1/2 level + 1 for damage. Simple, easy, no calculator or estimation required.