In my '91 Sundance I had Blaupunkt 5.25" up front. The speakers were rated at 45W RMS, but I was pushing 75W RMS to them. I did blow one of the speakers after a while, but who knows if that really had anything to do with overpowering them.
How to set gain levels. Turn gain all the way down. Start to turn volume up until you start to hear distortion. Once hearing distortion, back the volume down a tad. Now, leave it at that volume. Go to the amp and start turning the gain level up until you start to hear distortion. Once you hear distortion, back the gain down a tad.
So yes, gain should NEVER be used as a "volume control".