"letting out air from tires to ride on soft surfaces is common practice. even 4x4s do this."
That's why I did it, but it was vastly less preferable to having real mountain bike tires, so my advice would be, depending on how much of the time one is planing on using this bike as an MTB, then consider an MTB, for the tires and everything else.
Other than city bike uses this thing is to be used "some day" for light touring, and "hopefully on trails", though the thread is all about offroad performance. Other than Surly threads, the other most likely one around here is probably the "can I use my MTB for touring" For which the answer is always an enthusiastic "yes". Hardly seems as though the LHT is required for the uses described. Actually my Urbanite which is 1/2" or more higher in the BB, and otherwise a light frame loaded touring bike might be an all around better choice.
"you can get plenty of control from drop bars, just make sure they're nice and wide (44-46 mm). salsa bell laps are nice."
Exactly, the dirt drops are wider still, but probably not necessary for this rider.
"road levers with cantis can provide tons of stopping power. especially if you use old school high profile cantis - you'll have no problems locking up the wheels (not that you would want to). low profile cantis work fine too. Heck old mountain bikes used these and no one ever complained."
Not really true, I have Paul Neo Retros on my bike, and have been riding and wrenching cantis since the first MTBs appeared on the scene. There is a loss of power from road levers for sure, and I am far from the only one saying so. And I do want the capability to lock up my wheels, I don't want to always skid, but I do want to use all the power available right up to that point. "To infinity and beyond"