Agreed.
Although the height limit is technically a *limit*, there isn't a single person in the field of child passenger safety that would ever say that obeying a numerical limit (when all children grow differently) rather than the 1" rule would be beneficial. The logic behind the height limit is that we want to ensure that a rear-facing child's head is still contained within the shell in a collision. As long as you have that 1" of buffer, I would not consider the seat to be outgrown rear-facing assuming the child is still within the weight limit. My daughter was rear-facing in a Radian until shortly after her 5th birthday, and still had over an inch above her head
This is the only time we advise parents to break the rules, so to speak. If you're really concerned about this, do a search on the numerical height limitations on Canadian seats here in the forums and you'll find a lot more background and some great discussion on a number of threads.
-Nicole.