Shortly after I sent the email I thought about the possibility of a pin
seeing a negative voltage. Anybody know what the effect, if any, would
be on the processor? How tolerant is the ATmega16 of this condition?
That IS one of those "don't go there" conditions with any part.
EE on all processors is dependent on some conditions.
Loosing power in mid-write is a bad thing. /Reset asserted, bugs in code that modify the EE registers, bugs that call the EE routines with junk data, similar problems during the read cycles..