I don't think there's anything wrong with the "hybrid" approach. Obviously, some things take a lot longer to do in CSS/XHTML, so Photoshop is the best tool to use when brainstorming or comping for a client. But at some point it can become counterproductive trying to replicate all browser behavior in Photoshop, so I just "run with it" and deal with the detail in CSS/XHTML.
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I don't think there's anything wrong with the "hybrid" approach. Obviously, some things take a lot longer to do in CSS/XHTML, so Photoshop is the best tool to use when brainstorming or comping for a client. But at some point it can become counterproductive trying to replicate all browser behavior in Photoshop, so I just "run with it" and deal with the detail in CSS/XHTML.