I think I can answer SOME of your questions, chas...

From what we have been told, the Audya does time-stretching on its' audio loops. Now, as this can only go so far without becoming apparent, all of the loops were recorded at three different tempi, so the loop for a fast guitar strum is not the same loop for a slower one (which is how it should be). But even so, there is probably a limit to how fast or slow you can take any loop, but in fairness, that's probably outside its' useful range. It is possible (but I not sure for certain) that it also has sliced up the beats in the drum section, which would allow for more tempo variation without artifacts. Kind of like ReCycle, or Acid loops, etc..

But what we are hearing BETWEEN chords on the Audya sounds awfully like a degree of latency as it streams the correct chord (or close to correct!) in response to the input, and there seems to be some not perfect cross-fading between old chord and new. Anyone that has played a guitar knows there is a certain degree of over-ring when you go between one chord and the next, particularly open chords. But this is plain flat out impossible when you are cross-cutting between two recordings. Not that MIDI is much better at this, just pointing it out...

Guitar is a VERY non-linear instrument. At best, we can only approximate it poorly, with whatever system we choose to use. Claiming that any system has succeeded in 'realism' is simply a case of fanboy excess. If you listen like a REAL guitarist, or one that knows what they are supposed to sound like, you can easily hear the flaws in ANY system.