Code coverage tools can only tell you what lines are executed or not executed, I've never seen one smart enough that you can run it on a test suite, and have it tell you if all the side effects of every executed line of code is also executed.

I agree with you 100%, as I said in the OP

But it occured to me that while this would give you sought after 100% coverage, it not only did nothing to improve the quality of the test, but it allowed a (potential) bug to slip through.

The paper I linked to drives how this point even more, if you haven't already, you should give it a read, I thought it was quite good.