I happened to be doing some research and ran into this http://users.ameritech.net/knives/Juranitch1977Feb.htm. Go to the end of the page where we have the microscope shots.
It has to do with knives, but there are two issues of interest to us.
First, A microscope shot at 3000x shows the difference between dry honing and honing with oil. I assume the same issue arises with water. The suggestion is that the swarf contains microchips of metal that will produce tiny gouges in the edge, which you won't get with dry honing. It looks like the gouges are no more than a few microns, which you won't see with your 100x microscope.
Second, there are two shots on the right that show the effects of steeling. Without steeling, you get the usual scratch lines and microserrations. With steeling, the metal is caused to "reflow" and the scratch lines and microserrations disappear. The bottom picture shows a perfectly smooth edge (no visible scratch lines) at 3000x.
Has anyone ever tried gentle steeling with a razor? What I would do is steel with the spine and edge on the steel. Just to put things in perspective, at 3000x, what looks like 3mm is actually 1 micron, the scratch line width of a 15K hone.
In any case, I think we have two interesting issues here, and I hope we can have lots of discussion, opinions etc.