I wish I was a member here when you guys started this whole debate. It sucks that I'm only getting the ass-end of it now. Hopfully this thread will stay active since I'm only 2 months since the last posting hehehehe.
Now to light the fire (if i can)
I think the main thing alot of people should do is look at how they define the state of distortion.
The 15wpc shelf system can not damage the 700w speaker which sounds distorted. This is because the shelf system can not overdrive the speaker beyond 700w of heat/power or even come close to it. However, overvolting the 400w amp to reach its max at 800w constantly can damage the speaker since we are exceeding the 700w rms mfg rating.
In both cases, you can 'hear' a form of distortion. 1 type is from overmodulated sound from the shelf system to the speaker which is not damaging. The other is mechanical malfunction of the speaker itself which is damaging.
Therefore, if anyone says to me that distortion damages a speaker then I have to question exactly what they are referring to when they say distortion.