I think for the experienced riders here, toe overlap is not necessarily an issue. They know about it and can deal with it, like khuon says, by ratcheting (unless it's a fixie, of course). And cornering at speed is not an issue.

BUT, and this is where my concerns come from, the design principles are creeping into hybrids and comfort bikes, which are usually ridden by people whose experience and bike handling skills are somewhat less.

The point, I suppose, is that while people say it's acceptable for there to be toe overlap, then the designers will get away with it. It's certainly not listed as a cautionary issue in the manuals for new bikes that I've seen, yet the injury/law suit potential must be as great as it was before lawyers lips were introduced.