Don't run off Thane, I'm treading in deep water too. I was reading late into the night and wrote quickly this morning, it is now again getting late. Just wanted to keep you and those following along posted on what I was reading and thinking. What I'm reading and thinking has no more merit than what you are reading and thinking. We're all, I hope, just collaborating for our common benefit.

After reading your post I flipped through looking for articles on peg design and ended up in Volume 2 (the green book) starting on page 68. Whether I read what you intended or not, I learned a whole lot about what I don't know, so I thank you. Flipping through again I am reading Ben Brungraber's article in Volume1 (the red book). I'm not sure I'm in full agreement but he is one sharp citizen so it bears rereading.

Yes we were talking about spacing pegs based on the diameter of a steel bolt but using a wood peg. If after calculating the load you find that a 1/2" steel bolt would bear the load then the spacing dia is based on 1/2" not 1". In your drawing no load is given so I can't determine what size bolt would bear the load. This is another method of locating the peg from what Brungraber presented.

I've converted table 3 on page 77 of "Timber Frame Joinery and Design, Volume 2" to pounds and inches. It is the top table in this link;
http://windyhilllogworks.com/PegSpacing.htm
The bottom table is my attempt at justifying it with my understanding of the current spacing "rules". I divided the 2 peg allowable load in half to arrive at a single peg load then using the AWC connections calc found the bolt diameter that would carry that load. Using that diameter to calculate edge and end distances according to my understanding of Schmidt. Where the spacings are in black it seemed to agree, where in pink or red the results did not agree. End distances seem to be very conservative using this approach. Kessel and Augustin (the top table) show that a much shorter relish works,and softwood appears stronger than it would seem.

So that's where I'm stuck at the moment, Thane you seem to be conservative according to Schmidt, Schmidt seems conservative according to Kessel and I'm off to reread Shanks and Brungraber and sit on my hands smile