Derren, if you get a chance to answer my question (post #108), I'd love to hear your opinion.
I'm not trying to ascribe intent, so forgive me if it sounds like that.
However, the way you talk almost sounds like there's an antagonistic relationship between you and your players. You seem to be very concerned with giving them anything not allowed by the rules. If I'm wrong, let me know.
In my games, the rules are simply a loose structure to allow my friends and I to pretend we're elves. We're not trying to build a nuclear reactor; it's okay if we're flexible. If occasionally the players get something extra in a situation due to an amazing description or sweet roleplaying, I'm happy to give that.
You see, there's a unspoken social contract between my players and I: we're there to have fun; don't ruin other people's fun. No one's going to try to screw over someone else by overdoing the flavor on some power to eek out some extra effect. I don't play with people like that because I know I won't have fun with them (they're not looking for "my kind of fun"). Also, I have no problem saying no to things. Luckily, my players know when too far is too far and I never have to say no.
If you look at the game as a friendly environment where everyone is there to take a part in the story, then the rules seem less important to everyone's fun.
Your mileage may vary, of course.