People who hate Dolby NR have mis-aligned tape decks. When the recording levels are set accurately, Dolby is quite transparent.
yes, thank you, I was going to post this if I didn't read anyone else post it first.
Dolby B, C and S (and DBX for that matter) isn't a single ended system. you can't do the same thing as those technologies do with an eq, dynamic range expander or with DNR (which is single ended).
during recording, dolby dynamically increases the desired (music for example) hf content in a calculated compressed way (which is how all noise reduction works, it does NOT result in compression in the music when decoded properly, quite the opposite). net result - artificially increased high frequency content. then during playback, dolby dynamically decreases the desired hf content in the exact inversse of the original formula. C and S do similar things, but with more of the frequency bandwidth and more complex technology. dbx does it more than anyone else which is why it works better than anything else (although with badly aligned heads or cheap decks dbx results in a pumping sound, just like those same badly setup decks result in HF loss with dolby B).
DNR is single ended (reduce HF sound on playback when it's quiet and vaguely appears to be a constant hissing sound...). dns works well too, but not when there's actual music being played back.
there is no reason why dolby would sound compressed or muffle the sound unless the recording wasn't made well and the playback wasn't done on a deck that has exactly the same playback and hf extension specs.
But with a very good cassette deck, good quality tape, properly aligned between recording and playback processes, having dolby on during recording and playback is quite effectively proven to reduce some noise without altering the sound at all.
The thing is - those situations (very nice decks, all aligned identically and perfectly wtih perfect record levels and all trimmers adjusted perfectly) is very rare, so yea, dolby can be a pain in the ass when playing back someone else's tapes.