Yeah, the manual is pretty lame when it comes to describing the nightmode of the 1050.

The only reason I know what it's doing is from playing electric guitar and using sound compressors.

That seems to be exactly what the 1050 is doing. It compresses the sound and basically keeps it all at an even playing level. You know how you have a quiet scene in a movie and then WHAM!!!!...something explodes onscreen and is incredibly loud? Well, with nightmode, it limits that loud explosion. With each press of the nightmode button, it appears to be bumping up the amount of compression being used. The 1st level is pretty light, while level 4 is max compression. It will really limit the peaks of the soundwave and keep everything at basically the same volume level.

Hope this helps.

BTW, I rarely use this feature. I wake my girlfriend up all the time! :^D