Intriguing thread!
Indeed, there are things we don't want, and others we do. For example, if one was to reproduces drums realistically in your living room, then the person would go partially deaf in record time. I listened to my pro drummer friend play his drum set in his living room for no more than 10 minutes.... literally deafening, I had trouble hearing for days after that.
On the other hand, I and pretty much anyone can take classical concerts at the 7th row for 5-8 hrs a day without emerging hearing discomfort (provided a sane and realistic music repertoire - thinking about Bach, Handel, Schubert, Mahler, Mozart and not a marathon of screeching shrieking pieces trying to break the SPL barrier for no apparent reason).
I have voiced my system to reproduce classical music as I hear it in the concerts. It's something that is unamplified, has the highest quality acoustic instruments and most talented & trained singers - AKA the scenario where the matter of fidelity arises.
For amplified concerts, we have massive (largely transistorized) amplifiers amplifying the source, that is often not an acoustic instrument, and even the vocals can have filters / processing / EQ / compression on them. That is, the live event already has compromised fidelity, limited by the ability of the PA system and the electronics producing the effects. High fidelity is out of the question, and the only thing to do about it: REPRODUCE IT TO SOUND THE WAY YOU WANT IT. :)
Curiously, even live rock concerts and program albums will sound the best (to my ears) when a system is highly optimized for classical music. The only addition needed for live events is the ability to adjust the level of highs, as they can be vastly in excess or lacking, based on how the recording was mastered, and for what playback volume. Don't forget: the CD / etc recording w get is not the exact version of what the concert was, it has been mastered (=ALTERED) for the consumers with specific goals in mind.
Cheers; Janos