I can understand both sides of this actually, it’s a difference between a collaborative and a competitive organization structure. In a competitive structure you do not want the same level of user to be able to alter or perhaps even see pre-publishing the same level’s writings. But in a collaborative structure (like one I’m working on), I definitely want to be able to set it so that users of the same level can view (and perhaps edit) other user’s pre-published posts.
Would it be too much to ask to make it an administrative option whether the same level of user is able or unable to edit (or preview) another users’s posts?
The next version of WordPress (1.6 or whatever it will be called), with it’s revised user capabilities, will likely address your wish, rlc4.
If you need it now, try using a wiki instead of wp. That’s one of the main functions of wiki, after all….
