True, so my final decision is a small compromise to keep all functions.
Tape will be turned off when going into & out of input #4.
Inputs 1-3 will remain as is and will have monitoring capabilities.
Input 4 will be for playback or HT bypass only.
As a relentless fan of reel-to-reel and cassette-deck taping, I would resist the idea of dropping the tape loop (even if you are not into the tape recording hobby, there are other uses for it, as a processor loop for holography, for example). On the HT front - suffice it to say many of us only get one room in the house to play with in, and I have to make that room work for both HT and and 2 channel - so the HT bypass is a necessity and a blessing. Trying to listen to 2 channel sources using my HT pre/pro (as compared to the PLC1) is a lost cause - the passive pre is on a different league altogether (my pre/pro is an Emotica XMC-1, good but not good enough). So the solution you propose works fine IMO. I mostly record LPs from input 1 - rarely do I do monitoring of the other inputs.
Thanks for looking into this. Will send you my unit for refitting when the fix is ready.