Well, the way analogue equalisers work is that you have filters [fixed or variable] select a small piece of the audio frequency range. That little piece of the audio is then added to the original signal in either positive or negative polarity ["boost" being the addition in positive polariy, "cut" being the addition in negative polarity].
Whenever you put a signal through an analog filter you're going to get a phase shift. The phase shift is a timing issue. For example, when you filter off the bottom you're not only cutting the low frequency information, you're also slowing down the low end component of the signal allowing the treble freqencies to pass first. If you roll off the top, you slow down the treble frequencies. The human brain can register even the smallest timing alteration within a signal.
In the case of an economy EQ, the midrange components are perceived by the brain slightly before the low and high ends. This gives you the perception of a slightly "thin" sound. Any EQ (or some other pieces of gear too) that was designed with insufficient headroom or with a bottom or top frequency response that rolls off too high or too low will exhibit this problem. This is why expensive gear with a silly-wide frequency response that extends outside the actual audible range are often described as sounding "fuller" or "richer".
Bob
