If you want to get theoretical again if you record at a reference level of say -20 dB FS then you have over 70 dB of level below before the digital recording medium is going to introduce any noise. But you also have 20 dB of headroom above too which will easily cater for any loud bits! Try getting 20 dB louder with your instrument (from normal that is) and see how hard it is to do! (drummers can do it though!)

I would not imagine that acoustic guitar is something that also needs a compressor on the way into the DAW either. It is all about setting record levels correctly and accurately and if you do this and play the acoustic part evenly which is what you should do anyway you are not going to have any issues on the way in.

But you will have a lot of options once you are inside the DAW though.

I have used a compressor to record vocalists but it was usually set for limiting with a very high threshold so it was only acting as a watch dog and rarely cut in and did its thing. (this is a good way to use a compressor on the way in because it does not alter much about the dynamics of the performance in anyway) It was an African guy that had a huge dynamic range in his performance and the compressor set for limiting was the only way I could do it easily. But that was a rare case.

Using an outboard compressor is a great convenience when you are simultaneously both singer and engineer. It sucks when you manage a good performance, only to discover afterward that the signal's been clipped. 

However, over the years I've gradually abandoned compression during tracking altogether by simply lowering recording levels. That required un-learning years of conditioning, of believing signals always have to be as hot as possible. I don't even own a hardware compressor anymore. I much prefer to capture the full dynamics and then decide later how much taming it needs.

Regarding acoustical treatments, I understand where mixmkr is coming from. Room acoustics are not much of a factor when your microphone is 1/2" off the grill of your guitar amp. My recommendation was based more on concerns about vocals and acoustical instruments, both of which beg for some air between source and microphone. Unless you can afford to design a room specifically to sound great, as opposed to making do in a garage or bedroom, then your best bet is to try to remove the room as much as possible.

The best argument for starting with acoustics is that it's relatively cheap. $200 in absorption will do as much for your monitoring accuracy as $2000 in speaker upgrades, and absorptive baffles will do more to improve your vocal recordings than buying a $5k microphone. 

Any insulating materials that impede heat transfer will also absorb sound. Ordinary pink fluffy home insulation is at the top of the list, and it's cheap. It's also bulky, though, so compressed fiberglass can be more practical, even if slightly less efficient. For a vocal booth, three inches' thickness of rigid fiberglass or rockwool is all you need to effectively absorb the most problematic vocal frequencies, as long as you maintain at least a few inches' distance away from walls and windows.

bluesguy, if your 57 sounds muddy close-miking a guitar speaker, try moving it around relative to the edge of the speaker cone, as well as altering the angle of the mic. It's surprising how different it can sound at different angles and locations. Also, if your cabinet has more than one speaker, experiment with each one of them. You'd think that in a cabinet with 4 matched 12's that each one would sound the same, but they often don't. And one more thought: if it's a small cabinet, try raising it off the floor. Anvil cases are especially great for this.

Thanks so much bitflipper!(and everyone) Sounds like I have some experimenting to do! I will try all of these ideas and get back to you as a friendly FYI. Regarding the absorbers,etc. is there anywhere in particular you may suggest buying this stuff?(not pink insulation,of course, that's easy). And when you say maintain a few inches from the wall/window, that means leave it free standing, not right against the wall? And I assume the singer would then "surround" himself with it, or face it? Cheers, Brian.

Bluesguy, I've got some pretty good results recording vocals with a fairly simple setup

1 - position your vocalist in the corner of the room facing out
2 - hand a couple of duvets on both walls behind the singer
3 - in front of the singer I use a Reflexion Filter

I gotta ask. Are people using fiberglass insulation in studios uncovered? Obviously it is most absorptive if uncovered but it is also a health hazard - highly irritating to skin, eyes and especially lungs.

I'm sure nobody uses it uncovered. Stone wool is better than glass wool, though. I've seen stone wool uncovered in many places, but I don't know if it's been handled with some kind of primer or something.

I used a can of hairspray on mine, then I covered them with a thin material, just in case......

Use an open-weave fabric to cover compressed fiberglass. Burlap is cheap and comes in several colors. Speaker grill cloth also works well but it's expensive. 

Don't worry about the acoustical effects of coverings. The lower frequencies that are most problematic are unaffected by coverings. Some people even buy the type that comes with a paper backing, and leave the paper on. This actually helps by reflecting high frequencies, somewhat compensating for the fact that an absorber's efficiency goes up exponentially with frequency and therefore helps keep the room from becoming too dead. 

Here in Grand Forks we have a Rock wool insulation plant. It's called Roxul. 
It's made from a number of minerals which are basically inert. You can eat Roxul! IIt's a dark grey green colour. 
 All we can say is it's the ultimate sound absorber and 100% fire proof. It has a higher R value than "Pink" and you don't get itchy when installing it. 
So everybody's jam space around here features a "Green"  wall, and most don't bother covering it. The only residue will be  little black slag grainuals on the floor. No PM10 dust like fiberglass which is very bad for you. 
My studio is nice and dead because it's so full of junk! Overstuffed furniture, boxes of christams decorations, gig bags, piles of books and old equipment,