Tom,
I think you are seeing two differing view points on the issue. We only do e-commerce work, so we have gleaned our suggestions from the best practices in the e-commerce industry. I have done some pretty extensive research around this issue just to see what other companies do, that is why I suggested pointing your canonical back to your category landing pages. One issue I think is thin content. Do people really want to land on page 4 of a pagination?
With paginated category pages you actually run into a lot of SEO problems that are not addresses in 99% of all e-commerce platforms. Duplicate content, meta descriptions, and titles are some of the biggest. I am not familiar with any e-commerce package that will let you have different meta title or meta descriptions for paginated pages. Some might add "Page number x" to the title and descriptions, but that will still trigger duplicate content errors.
Lets look at what other sites in the industry do and how they do it.
Walmart
Walmart points all of their paginated pages back to the main category page. But they also do something interesting worth noting. They use rel=next on everyone as well. Even if the rel=next points to the page itself. See this screenshot of their TV category on page 2.
http://screencast.com/t/eZb9zbgA0u
If you notice the rel=next at the bottom actually points to the page you are on and the canonical points back to the category root.
Target
Target uses a filtering navigation on their category pages. It makes some really unpretty urls too. Below is a screenshot of a page 2 of their TV category.
http://screencast.com/t/oolK0hZy
They also point their category pagination back to the main category landing page as well. Also note that they do not use the rel=next or previous in their page as well.
Macy's
Macy's also points their canonical back at their category root page too. For some reason they have a query string on it as you can see in the image below. But in the next screenshot you can see where that page actually goes.
http://screencast.com/t/l3Jp2lxeBhTK
http://screencast.com/t/sDLTuAOa
Also it it is worth note that they don't use the rel next/previous on any of their pages as well.
Tiger Direct
Tiger Direct is another company that follows pretty much the same pattern as well. You can see by the image below that they point their paginated page back to the root category.
http://screencast.com/t/PsGft6CCgJ
I think the main reason of doing things like this works out two fold for companies. First you are putting more power into the category landing page and second you are providing better user experience. What does a paginated page of a category have to offer that the main page doesn't?
Sure Google might call using them the best practice, but that does not mean they will penalize you for not using them. We personally recommend to people to not use them and to point everything at the category root because that seems to be the standard in the industry. When you are trying to rank a page against other big e-commerce competitors you want to use every trick in the book to get ahead. Generally by not using this one it seems you won't.