Actually, that was three questions.
1) You should not make a habit out of using heavy throttle with the engine under about 2,000 rpm. Yes, that would be considered lugging and it heavily loads the engine's bearings that do not benefit from the higher lubrication pressures and protection at greater rotational speeds. You can hold a steady state cruise and use mild throttle at these engine speeds to the benefit of fuel economy and engine longevity, but downshift if you need greater rates of acceleration. Remember that the automatic transaxle will downshift automatically to achieve the requested high rate of acceleration and to protect the engine.
2) Coasting with the transaxle in neutral is a concern only if you need to quickly accelerate to avoid an accident. I routinely slide the shifter into neutral without depressing the clutch when slowing for a stop. This shifter motion occurs without friction at about 1200-1300 rpm while the car is still rolling due to the IAC valve maintaining a high idle while the car is in motion. I do not depress the clutch again until I am ready to engage first gear to start rolling. This practice saves one clutch press and the resulting pressure plate and throwout bearing wear for each stop.
3) The SHO engine develops peak horsepower in stock form at 6,200 rpm according to the Ford literature that I have. This engein speed would correspond to the maximum rate at which the engine can do work. The measure of work is a combination of the torque produced and the rate at which it is generated. Torque moves the car, but horsepower is the rate at which the car gets moved. (A locked rotor is when the peak torque output of an electric motor is generated, but no work is being done since work is defined as force being applied over a distance. One horsepower is the work performed by lifting 550 pounds a distance of one foot in one second.)
Since the power (and torque) curves drop off rather quickly after the power peak for a stock SHO engine, you would like to keep the engine speed around that power peak as much as possible to achieve the quickest rate of acceleration. Shifting near redline is a good method of achieving the best acceleration since the revs drop well below the power peak after each shift.
Looking at the dynomometer curves that my engine generated last February (at 255,000 miles), it reveals that the modifications to my engine have kept the power peak near 6,200 rpm, but the power decrease above that figure has been greatly lessened by the intake and (primarily) exhaust modifications. My old engine was still generating 175 hp at the front wheels at the 7,300 rpm rev limiter. This change gives my engine more working room under the power peak and will allow me to benefit from shifting at the rev limiter.
(I needed a few moments of break from C++)
<small>[ November 13, 2002, 05:18 PM: Message edited by: sdpatt ]</small>