I don't think anyone was arguing that it's not possible to associate
notations with processing.
Here's why MIME is better than notations for general use:
o Usable in and out of XML.
  MIME is meaningful to MIME processors; notations are meaningful to
  XML processors.  XML processors can easily be MIME processors; the
  reverse is not true, especially for legacy reasons.
o Hierarchical.
  MIME has built-in fallback behavior.  Notations do not.  You've
  shown that it's possible to implement fallback, but it's not
  inherent in the system.
o Interchangeable.
  MIME works now, and it works well.  Notations *could* work in
  interchange, but they don't now.  If you give someone a notation
  declaration, odds are good that their software won't immediately
  know what to do with things in that notation.
o Flexible.
  As Liam pointed out, data notation information properly belongs with
  an entity.  XML stores that information with the *reference* to the
  entity, a place where the information is not always know.
So, I would recommend that we standardize an FPI for MIME itself, and
use that as the notation declaration for any external entity.  The
processor can then determine the actual data content notation of the
entity just as it would for any other object (explicit MIME type, file
extension lookup) and take appropriate action.
-Chris
-- <!NOTATION SGML.Geek PUBLIC "-//Anonymous//NOTATION SGML Geek//EN"> <!ENTITY crism PUBLIC "-//O'Reilly//NONSGML Christopher R. Maden//EN" "<URL>http://www.oreilly.com/people/staff/crism/ <TEL>+1.617.499.7487 <USMAIL>90 Sherman Street, Cambridge, MA 02140 USA" NDATA SGML.Geek>