[guard-of-terra]

I actually never seen VLC clip sound that much on volumes > 100%.

Maybe if your speakers are very quiet and crappy and you have to get every control to 100% (hardware, system, vlc) in order to hear anything - maybe in this case it will.

Hard clipping is very noticeable for the listener so not many people will set it to the maximum if they have choice.

Anyway, you can protect from this either in hardware or in the driver.