It still bothers me that 10.4 / WebDAVFS/1.4.3 didn't behave this way. It would be comforting to find a page (from Apple would be ideal) that definitively indicates there is a difference between the clients and that there's no way to change it.
I've used FUSE before & like it quite a bit, but I don't think it's reasonable to expect end users to compile their own FUSE DAV plug in. Because of another unix timesharing service here that nfs mounts the same target file systems, the built-in sshfs support helps some of our users with this problem, but access to that service is limited & so only a minority of our OS X users gain anything from it.
The 'auto_xattr' option listed in the macfuse options (
http://code.google.com/p/macfuse/wiki/OPTIONS) does leave me with hope Finder's behavior can be adjusted.
For the sake of completeness and a hope it may help others who stumble across this thread, here are some additional links I can across while looking into this issue.
Ignoring the title of the page (although fitting), some good info on Apple Double files is here:
http://www.litfuel.net/plush/?postid=147
Additional info here:
http://arstechnica.com/reviews/os/macosx-10-4.ars/7
http://en.wikipedia.org/wiki/AppleDouble
This also explains why cd-ing/ls-ing, etc works without slowness from terminal.app - only finder uses the extended attributes.
Related info on the .DS_Store file here:
http://www.macosxhints.com/article.php?story=2005070300463515&query=smb