Re: benefits of constant bit rate versus variable?

"VBR will not assign a higher bit rate than set for difficult scenes, and apply a lower one for easy ones"

That's exactly what it's designed to do within the confines of your Min, Ave and Max settings

"Overall less visual quality"

Wrong.

"Great for getting lots on a disc"

Agreed, but not the only reason to use it.

"But if all scenes (easy and hard) are encoded at say 7 mbs, then the overall image has to be better, or am I missing something"

Yes you are: What happens one of those harder scenes requires, say for example, 8.0Mb/s?
A m-pass VBR encode would adjust the bit rate to cope with the extra complexity, the CBR encode would simply drop off in quality.