Comment 3 for bug 579290

fk, thanks a lot for that link. I've discovered something useful on a page linked to from the Ubuntu wiki (see http://pulseaudio.org/wiki/PulseAudioStoleMyVolumes). Briefly, PulseAudio uses the product of several settings (in my case and perhaps yours, 'Master Front', 'PCM' and 'Front') to achieve the desired volume level. However, the first of those three doesn't actually influence the volume coming out of my headphones, perhaps because they're plugged in at the back of my PC and not the front. The fix seems to be to remove the Master Front horse from the big volume carousel, achieved by:

Alt+F2, run 'gksudo gedit /usr/share/pulseaudio/alsa-mixer/paths/analog-output.conf'
look for [Element Master Front] around line 37
change 'volume = merge' to 'volume = ignore'

This gives a much better result for me. Now the range of settings on the volume widget from 50-100% are useful. 100% corresponds to full volume, and below 50% there is still a continuous range of levels, but they are all too quiet to be useful. Still, 10 volume levels is much better than 1.