About the Quality slider:
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I suppose I'm wondering what the setting does behind the scenes? Quantization errors? It's been quite a while since Calculus, but I would've thought the samples would influence the accuracy. For example, with Integrals, the more samples / larger domain, the better the approximation of the area.
No, much processing works on blocks of audio (hence the latency setting) and they overlap. If you reduce the overlap, you'll get steeper slopes on the sides, which means that there will be some effects mainly to low frequency sounds (blob-blob-blob sound or wobbling effect as it is called by some people here on the forum). You'll hear it for example if you play a low frequency (say, 50 Hz) sine wave and use the phase linear highpass filter.
To get a perfect output, the overlap should be 75% - in other words every sample should be processed 4 times.
Unfortunately, in Stereo Tool the overlap is only 50% - every sample is processed twice. That's what causes this effect.
If you reduce the overlap further (by lowering the slider), the effect gets worse because the overlap is reduced further. It will get both bigger in amplitude and higher in frequency.
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...but bear in mind I still truly believe there are performance improvements possible for systems with 1MB L2 cache.
But... Then I would expect the CPU load to drop a lot if you lower the latency. At a latency of 512, the memory usage would - for most things, agreed, not for everything - be 1/8th of the memory usage at 4096! (The memory is still allocated because in a real-time program you don't want to dynamically allocate and free memory, but most of it just won't be used - hence also not be cached).
Now it could be that it does drop - to test that disable 'multicore' as I've seen earlier today that it has less effect at lower latency settings. Also, please disable the Advanced Clipper since it behaves differently at different latency settings - most other filters don't.