Camouflage your flaws. Absolutely. Do the big house cleaning after the party, not before. Dim the lights; create a wow factor as guests walk in--a vase of tall flowers, uplights on a piece of art, twinkle lights in an unexpected place---and they'll never notice the dust bunnies in the corner.
Do not be afraid to fake it. You can't do it all. If you aren't sure about a four-course meal, then plan a big pot of soup and ice cream sandwiches for desssert--who doesn't like those? Just put them on a pretty tray. One of our favorite meals is a Caesar salad put together in front of the guests, a big pot of homemade tomato soup, and a good red wine. You have your own speciality--try it out.
Be a mix master. Don't have eight or ten of everything? No problem. I mix and mingle a few stems of crystal that were my mother's, a few of my wedding gift stems, and a few Waterford water goblets (see # 80 in my list of 100). If people comment, I tell the story about each pattern. Same with china. Though I still enjoy my unadorned wedding china---Lenox Solitaire--I do like to put contrasting salad plates with it--and the ones I use most came from Big Lots. Bottom line--be creative with what you have.
Know when (not) to fold them. Folding napkins is the least of my worries, but I do like pretty ones. Years ago, I bought two dozen animal-print napkins, and I have used those so much that they have faded a little, but they are soft, absorbent, easy to clean, and they look great on the table.
See how low or high you can go. I agree that table decorations should never impede vision. Low is fine, but I prefer tall. If you get the arrangement above the line of vision, that works, too. I often use a tall (27") silver vase, and sometimes I even raise the vase. Years ago, we removed the chandelier from the dining room and replaced it with a recessed can so I could have tall arrangements, and I have never regretted that move. See photos above.
Break up the couples. We've been doing this for years. I like using place cards with eight guests or more (my favorite place card holder is a wine cork with a dime glued to the bottom, but that's another story!), and I usually take the opportunity to separate couples. It eliminates confusion and the "where do I sit" question; it is more singles-friendly; and it enables more conversation. At a table for four, you have four households represented rather than two. And if, perchance, one member of a couple tends to dominate the other---well, you get the picture. Of course that would never happen.
Some rules are made (not) to be broken. Precious few, I'd say. However, I agree that the place setting is one of them. Let's not mess with fork on the left, knife on the right; bread plate on the left, stemware on the right. That system has worked for a long time.