Cleave on AoO, etc -
In my group, we've debated a few times over the Cleave on AoO or not, and we feel that it's not appropriate. Even though by the definition in the SRD it *would* be allowed on an AoO, it's not really logical.
First off, the whole "Cleave" effect can be looked at lots of ways. It's easy to imagine anyone wielding any bladed type weapon cutting thru and then into an adjacent opponent, and it's also relatively easy to imagine a skilled warrior being able to make an attack, down the target, and then continue the momentum into another foe. Someone earlier posted about how you could do that with a mace, etc -- but they obviously haven't been smacked around in combat by someone proficient with their weapon, either.
We don't allow Cleave on an AoO because of the nature of the AoO, not just the nature of Cleave. An Attack of Opportunity is exactly that: an opportunity. By interpreting the AoO as a "swipe at someone as they pass" or a quick jab while an opponent is wide open, etc., then there's really no logical place for the Cleave. AoO is limited to 1 per round (unless you have Combat Reflexes) for a reason, and to me that precludes Cleaving on an AoO as well.
Now, on the player's turn, when they can concentrate on a foe or two and begin leaving swaths of dead goblins behind them, Cleave makes much better sense, and is killer fun. Arms, legs, and heads a flyin'...
On a related note, we've also cheesed Great Cleave a little bit as well, for anyone who's interested in GC but afraid to use it:
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HAZARD'S HOUSE RULE GREAT CLEAVE [GENERAL]
Prerequisites: Str 16, Cleave, Power Attack, base attack bonus +4.
Benefit: This feat works like Cleave, except you gain an additional number of attacks equal to your Strength score bonus. For example, if your fighter has a Strength of 16 (+3 bonus), you could conceiveably Great Cleave up to 3 times.
Normal: Cleave grants an additional melee attack when downing or killing a foe in combat.
Special: A fighter may select Great Cleave as one of his fighter bonus feats.
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Main changes are the STR requirement, and basing additional attacks off your STR bonus... The stronger you are, etc etc etc...