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Really? The "line" in "line cliche'" refers to the stepwise movement of an inner voice across different versions of the same chord, right? In some cases, the root of the chord can stay the same, e.g. Dm, Dm/maj7, Dm7, Dm6. There, the inner D drops down stepwise to the minor sixth.
In others, you can move the bass of the chord from say the chord's root to its major or minor third, e.g., D, A7/E, Fdim, D/F#. There's still a chromatic line there, but it's not in the bass: it's just in the soprano, and it's composed of scale degrees 3, 4, flat5, and 5.
Diminished chords are often used as passing chords in these things, but not always. In those passing cases, I think of them as inversions of VII -- maybe I shouldn't!
I'm definitely guilty of using "voice leading" loosely. To me, everything is voice leading. But you're right: there's a difference between the smoothest voice leading and other kinds. You're talking about common-tone voice leading, for example. Another good guideline in producing smooth voice leading is contrary-motion-nearest. Etc., &c.
I'd like to sit down one day and plot out advanced chord progressions with good voice leading on the fretboard more systematically. Ouf! One of these days...
Can you or Jack or anyone else recommend some good versions of this tune? It's been done to death, and it's kind of a groaner -- every mediocre singer wants to get up and belt out her maudlin, boozy version -- so I'm looking either for unusually good readings or really innovative or unusual ones.