I'm starting to feel bad about this. I know that discussing the mob template is technically on topic, but it feels like hijacking to focus on such a small percentage of the book. Still, I suppose it makes sense until more people buy it, since we at least have some basic understanding of this concept due to the Dungeon article and input from earlier in the thread.
Anyway, I agree on DR completely stopping a mob's attacks provided it is 5 or higher. It's not so much a matter of a mob getting past a riot shield. I think a better analogy would be trying to stop a Sherman tank by punching it. I don't care how pick a mob that is, it's not going to get through armor that thick with fists. I'd say it's the same with DR monsters. A golem's armor is so thick it turns away blows from everything but objects made out of the hardest substance on the planet or the equivalent. A demon is so coursing with dark nature that only a weapon filled with holy power could counter the creature's evil taint and do true physical damage to the being of pure unholy power. I don't see how significantly upping the quantity of mundane attacks over the course of a few seconds would counter armor of this nature. I agree that this applies to swarms too, though I thought it already did. It would explain why that Crown of Vermin spell in the Epic Level Handbook gives the vermin DR 1/epic.
Oh, I thought of one more fairly important modification to the mob; a consideration for environmental and constant effects. As far as I know, such a consideration doesn't currently exist, so if the mob, for example, fell off a cliff and lands a half-mile later, it takes the 20d6 damage and then moves on with no casualties! The same is true if the entire mob is forced through a wall of fire or blade barrier, or is completely immersed in a pool of lava or acid, or gets caught in a tornado, and so on. This strikes me as amusingly ironic, since the most common complaints for realism after "a barbarian can singlehandedly kill 7,000 soldiers" which this template partially corrects, are the "a barbarian can fall ten miles and survive" and "a barbarian can take a few rounds skinny-dipping in lava and survive" issues. And this templates says that not only can a mob of 1st level commoners survive these same conditions, it can theoretically do it without any casualties!
Using my template modifiers above, I would say if a mob encounters an environmental or consistent source of damage that would do enough base damage to give the mob at least a negative level (like the 15-30 range i mentioned earlier,) and the entire mob can't escape it, it would destroy the mob instantly. However, if there's a way for the mob to partially move around it, it would be treated as an area effect with the 50% damage increase. In other words, if the mob was forced into a tunnel filled completely with lava or blocked by a blade barrier, or fell off a cliff and into an acid pool, it would be destroyed. However, if they move past a blade barrier or over a river of lava and there's room to climb over the barrier or above the lava's surface, it would only be seriously damaged. In terms of imagery, I see it as the first wave of rioters dying instantly, but the later ranks would use the burning or chopped-up bodies as a temporarily bridge or hill and climb over it to get to safety, albeit with very heavy casualties.