Wow. That Alison Krausse and Union Station album is wonderful. I had to buy it. Thank you for the suggestion. 
 
As for the original post, I realized that, in fact, I was misusing the expander. Now I am very content with the sound. Rookie mistake: I was adjusting the expander gain UP instead of DOWN, thus I was lifting the noise floor up to audible levels. Live and learn.
 
Thanks to everyone on this thread for your helpful responses.

Bitflipper has it above. I'd add this: why are you using an expander? Never use anything without a reason.
 
One really good rule of thumb, in all audio engineering, not just this, is to see how little you can do. 70db is a really pretty good signal to noise ratio. Maybe you don't need to do anything much.
 
If you do want to lose noise, you'd be better off just slip editing out the silence, rather than use an expander. They're kind of brute force, last resort tools, really.

I'm using the expander specifically to reduce the noise floor. The end goal is to boost the mix output to a decent level without boosting the hiss in my vocal track. Currently, if I boost the mix output without the expander, the hiss in my vocal track rises to a distracting level.
 
My expander threshold is down at -50dB (the lowest my plugin goes) with a soft knee and gain reduced ~10dB. I find it very elegant in reducing hiss without affecting the vocals. I was not getting the result I wanted because I was turning the expansion gain up instead of down. A brain fart moment.
 
I do edit out silent vocal segments during instrumentals but because it is just me and an acoustic guitar, there are too many gaps, trail-offs, and breaths to gate or edit out cleanly. 
 
I agree with you that the less you mess with, the better. I've trashed lots of mixes that got out of hand and started fresh. In this case I think the noise floor reduction was a necessary step to allow for a clean mix. I only have this issue with my SM7 due to the gain requirements. My acoustic guitar is recorded with a condenser mic and has no hiss issues. For my songs with louder singing the SM7 will be vital and I likely wont need the expander at all.

Hmm.
 
Here's my suggestion: try doing a couple of mixes without trying to get rid of the hiss. Then live with them for a bit, and see what you think. Lots of great records have a bit of hiss on them. Indeed, it can be kind of soothing to the ear, in the right context.

I don't know this for sure, not having heard the material, but from what you're saying, I think you might being having a "not seeing the wood for the trees" problem here. Do you actually have problematic hiss? At the SNR numbers you quoted, I wouldn't think so.

If the hiss bothers you, it is best taken care of at the recording stage.  Yes, you can mess w/ it in the mix, but you can't "fix" it.  Good that you found a work around, tho.
 
@

I just bought my first ever condenser mic, and the learning experience of it was interesting. I actually live in the country, so there is very little ambient noise, but the microphone was so sensitive it was driving me batty. I tried everything to lower ambient as much as possible EQ/gating/comp thresholds, you name it, but I found the solution (that suited me) was a simpler answer.
 
I really didn't participate in the forums much until X3, so been learning a lot recently, and posts about noise reduction with Audition/Audacity have passed by. I own Audition (I believe Audacity is free), but never really explored it until recently, and it is useful for this...
 

1. When recording audio, I will let a good 5 seconds of pure ambient noise run at the beginning AND end of a track, do my recording, save, and close X3 (so X3 "releases" the audio file allowing it to be edited/saved elsewhere).
2. Open that track in Audition, which can first be used to "declare" the ambient noise (I choose the tail of my choice), and then with the clip highlighted, can then "process" the clip to remove that ambient from the track. Save, close Audition, and reopen X3.
3. When the project reloads, the tracks are incredibly clear and crisp, so this "work flow" has become standard for me now. After the "raw" is cleaned, I use X3 to do the rest.

   I have not had to get into what Audition is capable of (blindly declaring ambient and processing the clip has worked fine), and from posts I have read, Audacity is recommended by many for use in a similar way.

It is very likely I am not seeing the wood for the trees. In fact, I started this thread because I was pretty sure I was driving myself crazy thinking my hardware was creating too much hiss and I needed some measurement principles to convince me otherwise.
 
After the responses in this thread and about a dozen remixes I've come to believe that my source recording has very low hiss levels. I do not want to give the impression any longer that the recording has "bad" amounts of hiss in it. In fact, as some have suggested, the hiss can give some sense of space to a song. One professional track I listened to that has hiss AND hum to a strong degree is Dido's "My Life" from her "No Angel" album. The song has a very live sound to it in the sense of space it evokes. Most of her vocals have noticeable hiss on the album.
 
As for noise reduction, I tried several plugins for that but found that no matter how I tweak the settings, the sonic alterations to my vocals were unacceptable. I looked at more expensive software before I stopped myself and started this thread to get some clarity.
 
I've managed to get about 75% of the sound I want out of my mix so far. I have focused more on conditioning my dynamics and EQ to bring out the sonic qualities I want in my voice and guitar than worrying about the hiss. Now that I believe my recording levels are good and that my hiss is actually very low I feel secure in producing my album with my current gear.
 
Thanks for all the suggestions and information.

Noise is good... Just use envelopes that cut it out on the intro and the outro. Then when you hear it "In the mix?" You won't hear it.