..."gain" is simply the ratio of output to input between any combination of two of those points where the signal is meaningfully correlated. If you can measure levels in multiple spots, you can calculate gain across different parts of the signal path as well. In any case where you can calculate gain, "unity gain" is the point where the result of the calculation is 1.
You're right. Gain can be calculated across any two analog points in the signal chain. And it can be calculated at any two points within a single digital device. And "unity gain" means a gain of 1 (which equals 0 dB).
The first danger is saying that turning Out1 all the way up will give you unity gain. That only gives you unity gain across the volume pot (because that's how volume pots work). But it's
not unity gain for the entire AX8. The volume pot is just one of its components. There are other sources of gain — both positive and negative gain — within the AX8. The advantage of diming Out1 is that,
if you're connected via S/PDIF and if you're running into a DAW, 0 VU on the AX8 gives you close to 0 VU in most DAWs. That's a convenience — if you're using a DAW.
The second danger is saying that turning Out1 all the way up is the best starting point. Sure, it gives you the best signal-to-noise ratio — in one component (the AX8). But, in all but the most extreme situations, that noise reduction cannot be heard by human ears because it's masked by much stronger sources of noise (like your guitar, for instance). It's an inaudible improvement. And that makes it less important than anything else which might audibly improve the audience or guitarist experience.
If the sound guy can't or won't cut the gain on your channel... if you share responsibility for house levels, and you find out halfway through the first song that you need more volume to FOH... if you don't get to run through the PA at all... these are all reasons why it will be better to start out with Out1 below maximum. Turning down Out1 will make an audible improvement in the sound, and that overrules any
inaudible change.
...when they are told to "turn out 1 all the way up" they tend to just stick to this. then they go to a gig where the sound engineer won't reduce their channel gain (for whatever reason) and there is a huge problem. this has been documented countless times by now, and i'm just saying it's a reality.
This. Much trouble and frustration has been documented here when people read that maxing Out1 is the "best thing to do." And
@chris is right: many people are tuning out this discussion because it's "geek talk" that's outside their comfort zone. They're just waiting for the final takeaway: "Just tell me what to do."