Diff from middlecoin increased from 512 to 1024. That's why. That number doesn't mean anything but a stat that you can compare to itself and only when diff stays the same
Yeah, that would be true for a pool mining a single coin for many hours straight.
I don't think that middlecoin really switches 1500 times a day as someone guesstimated a few pages back. But with frequent coin switching and below average performance rig (sub 500 kh/s) your chances of getting a share accepted before the pool moves on to the next block or switch to another coin occurs are lower with 1024 diff.
You actually didn't prove me wrong there I think... You are saying the same thing, but maybe don't understand that you are. You have half the chance of getting an accepted share. So your efficiency in cgwatcher (it's based on the amount of accepted shares not taking diff into account) will be halved. But the shares you do find are worth double. So it will even out in the end.
As to the coin switching. As long as you don't put --no-submit-stale in your config, you will still send your share of a previous coin to the server. And as H2O has mentioned already countless times, the server will still accept that share even if the server already switched coins.