I saw an interesting feature request on one of the Adobe forums whereby no matter the initial settings of those sliders, IF indeed the raw image values were clipped, you'd get the option of a new kind of new color clipping overlay. This would tell you, don't mess with the sliders, you blew your highlights.
That feature would be cool. Eric, thanks for the response.
Bearing in mind what you said, I fiddled some more, and, lo and behold the exposure and brightness sliders do not create false density in blown areas. The false density effect I saw was the result of using the recovery slider in addition to those adjustments. So from this, I gather that I need to be careful when I'm pushing things with the recovery slider.
I'm attaching some shots (shadow and textured wall in sunlight) I did with the S90
1. Apparently overexposed file: Bright area show red at ACR default, but shows texture when developed with Exposure -4 and Brightness -10
2. Badly overexposed file: Bright area shows red at ACR default, stays red with Exposure and Brightness sliders all the way to left
3. Same badly overexposed file: With Exposure and Brightness all the way to left, Recovery all the way to right, false density is introduced at edges.
4. 100% crop of #3 showing banding, just for kicks.