To sort of respond to some of the suggestions I've been getting, I'll explain a little about the makeup of this group.
There are four of us total, three players and the DM. Of the players, me and one other are both DMs in our own groups. The other player is a fairly new gamer (I'll get to that in a second). It's not a matter of no gaming for us if we up and leave... we both play in each others groups, despite their being no other people in common... It's more that, the DM in question really wants to DM, and we are his friends, and have been for some time... If we just stop comming, he will get mad, if we talk to him, he will probably be offended... We just don't know how to deal with the situation. And what makes this so galling is that, as I've stated before, he used to be a VERY good DM. Fair, fun, etc.
Now to respond to a few specific points...
This isn't adding "realism." This is just being a jerk. Does he do the same to his NPCs?
Not that I can tell. I mean, he rolls dice, but I can't recall them ever botching it. I guess it's that Mensa IQ thing.
I regularly do worse to my PCs in this area. See my response to 1, above.
Yes, me too. But not after I've dramaticly reduced the effectiveness of certain staple abilities and tactics.
I see nothing wrong with this one; I do something similar, although in my games, detecting evil is a subconscious thing, even for players. It's not like, "I detect evil. He's evil? I slay!" Instead, it's like "there's something...wrong...about that guy over there."
Sure, but said paladin then treats a guy who saved her from being sacrificed to a dark god like a foul-mothed lepper with a time-bomb strapped to his chest, just because he's not an upstanding citizen? I guess I'm not seeing the "good" in that portrayal of "lawful good".
And as for the "why" respond from Shadeus... I think you might be on to something. He's at Eastern Mich... studing to be a director, of all things (as in the movie type)... and he does tend to have an ego about that.
As for that thing I mentioned earlier in this post about the new player...
8) The DM has a rule that what you say, you do, unless you put your hand on your head first (Not sure where he got that from...). Unfortunatly, with a new player, this just DOES NOT WORK. IE, she forgets about AoO, or mis-remembers the radius on a fireball or something... but it's too late to do anything about it.