David,

There are several factors in the reduced performance of .357 Magnum, and it doesn't really have anything to do with "dumbing down" the loads.

At the time the cartridge was originally introduced there were two things still very common. First was jacketed bullets were unheard of for revolver cartridges, lead was the norm. Second was that cartridges were still commonly tested in actual firearms of the type the cartridge was intended for. Typically the longest standard barrels were selected for determining best (read most impressive) performance to be published. So, the most likely barrel length used would have been an 8 3/4" S&W .357 Magnum.

Let's look at relative performance. As you noted, published velocity for 15.5 gr 2400 behind a 158 LSWC will generate 1525+/- FPS, and it does this from an 8 3/8" barrel revolver. Actually, 15.3 gr will do this, and loads have been published up to 16.0 gr. I have chronographed loads up to 16.0 gr, and there is virtually no improvement in velocity over 15.3 gr.

The first thing that has reduced velocities is the widespread use of jacketed bullets. Using the maximum listed loads of 2400 from the older Hercules/Alliant manual, 15.3 for lead and 15.2 for jacketed the results I have obtained from my 8 3/8" Model 27 are Lead 1515-1530 FPS, and jacketed bullets 1240-1285 FPS. That is a loss of 230-290 FPS from, basically, nothing more than changing bullet type! The highest velocity I ever observed with a 158 jacketed bullet was 1335 FPS. Note that these were all fired in the same revolver!

The second thing is rarely does anyone shoot and chronograph an 8 3/8" revolver. Most data you see is what did someones 6", 4" or 2 1/2" barrel did. Well, I can show you that by test samples shot at the same time, with the same batch of ammunition, in different barrel lengths. Just a small sample, using the 158 JHP/2400:

Hdy 158 XTP-HP, 15.2/2400
8 3/8" 1283 FPS
6" 1233 FPS
2 1/8" 1067 FPS (640-1)

Speer 158 GDHP, 15.3/2400
8 3/8" 1240 FPS
5" 1140 FPS

158 LSWCGC RCBS, 15.2/2400 (This batch of powder ran a little slow)
8 3/8" 1504 FPS
6" 1405 FPS
2 1/8" 1157 FPS (640-1)

Note that an earlier lot of powder gave 1525 and 1529 FPS from the 8 3/8" barrel. These were all shot in various Model 27 S&Ws except as noted.

I have a lot more, with other powders, but these are representative of the classic full power .357 Magnum load that delivers original velocity with full length barrel and lead bullets. So, if you have a load with a jacketed 158 that does 1250 in a 4" barrel it really is doing far better than should be expected, and it is hardly a reduced load! And, FWIW, 1525 from a 158 gr bullet in a 6" barrel isn't likely to happen! I hope this helps you to see what is reasonable for the cartridge with loads that do replicate the original ballistics of the cartridge.