I eventually settled on making dwarves +1 LA for my new side game (that is, a 1st-level dwarf is treated as a 2nd-level character in terms of gaining experience etc.). The people who were arguing with me on the Paizo boards don't agree with this move either, but I'm pretty sure that the answer there is going to boil down to "we just plain don't agree, get over it." However, I am also wondering if it's actually worth the trouble to do that.
Of the gaming group, I'm the only real numbers-runner among us; I like to plumb and tweak the system, which is why I enjoyed using the HERO System so much. As such, I'm the only one in the group likely to care about a numerical imbalance between the mighty, mighty dwarf and the sad, gimped half-orc. I don't think any player in the group has created a dwarf character yet since we first started using 3.0 back in 1999 or whenever it was anyway (Has this group really been at it that long? Yikes!), so it's not like dwarves are being abused left and right. Part of that may be becuase I nixed dwarves, halflings, and gnomes for the first game we were doing, but there have been plenty of other games since then.
So I dunno, maybe I'll drop that idea and just let dwarves be uber. It's not like the GM can't stomp on 'em anyway should they choose to. ;)