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Now consider an extreme cant of 90 degrees CCW. The rifle has been rotated around the aiming axis. The bore and aiming axis are now in the same horizontal plane, with no elevation compensation and the pellet will hit low by the amount of drop at the target distance....
You got that part right. The vertical equation as it relates to drop and gun cant angle:
vertical error = drop x (1-cos(cant_angle))
...But the bore is now pointed to the left of the aiming axis, and the pellet will hit left by an amount determined by the angle between aiming and bore axes. Since the magnitude of the angle is related to the amount of separation between the axes, the rifle having the greater separation of axes will hit further left.
You got that part wrong. The once vertical compensation for the drop distance is now horizontal, so it will hit left an amount that is equal to the drop. The gun does not care where the viewing angle/position is, so the sight height or angle is not part of the equation. The horizontal equation as it relates to drop and gun cant angle:
horizontal error = drop x sin(cant_angle)
For your the 90 degree example above, sin(90) = 1, and cos(90) = 0.
Your 90 degrees is a fairly extreme example but it does show the point well. The equations works equally well for any angle from vertical.
http://www.scoplevel.com/
"The once vertical compensation for the drop distance is now horizontal, so it will hit left an amount that is equal to the drop." Wow. It absolutely amazes me that someone could state this. The first half of your sentence is correct. By laying the gun on it's side, the vertical compensation (which is by definition the convergence angle established by scope height) IS now horizontal. It is EXACTLY that convergence angle that has been moved to the horizontal, and ONLY that convergence angle function. Gravity doesn't somehow magically follow the movement of the gun and all of a sudden begin acting in the horizontal plane. Gravity always works ONLY in the vertical plane. You assume that gravity somehow "follows" the movement of the gun. It does not. It is independent of the gun. Gravity's effect works ONLY in the vertical plane. But the ANGLE established by scope height DOES follow the gun. And when the gun is laid on it's side (canted) that ANGLE is what determines how far "left" it will hit, not gravity. In that "laid on it's side" position, gravity will ONLY determine how much BELOW the now horizontal bore line it will "hit". And gravity (or "drop") will have absolutely positively NO impact on how far left it will "hit".
I believe I now understand why you cannot grasp this. You are unable to disconnect gravity (which always works only in a perfectly vertical dimension) from the "vertical compensation" (which can be vertical, horizontal, any point in between, or even upside down). IF (and only IF) one is shooting with the gun held in the VERTICAL PLANE does gravity function in DIRECT LINEAR CONNECTION with the "vertical compensation", which is by definition the ANGLE. When you lay the gun on it's side, gravity does not turn off. But NEITHER does it shift its direction of function. Gravity's function remains in the vertical plane. BUT BUT BUT when you lay the gun on it's side, THE ANGLE does change it's direction of function. By EXACTLY 90 degrees. The ANGLE was functioning in the vertical plane when upright but it has been "laid over" to function in the horizontal. Gravity doesn't somehow know to "follow" that movement. You must be able to view the two relevant factors (GRAVITY and ANGLE) independently.
Try to imagine shooting at a target with the gun in the vertical plane (NOT CANTED), with scope above bore but also inverted with scope below bore. Is the OBSERVED DROP the same? NO. NO. NO. In the first case, the "vertical correction" is working linearly with but opposed to gravity. In the second case the "vertical correction" is still present but is inverted and is still working linearly with but now synergistically with gravity. From the point of aim, the drop would be different for the two situations. GRAVITY would have the same effect in each case (it is a constant) but the ANGLE is 180 degrees different (it is a variable).
In "more normal" shooting, where a few degrees of inadvertant cant may be introduced while shooting and nothing as extreme as the above needs to be illustrated, GRAVITY remains a constant and ANGLE remains a variable. When you cant a gun some small amount, as might happen in error for any shooter, gravity has exactly the same OVERALL EFFECT (it is and always will be a constant and it is fixed in direction-the vertical plane) but the OBSERVED EFFECT (the amount AND direction of miss) is determined by that constant (gravity) modified by the variable (CANT) . GRAVITY will always effect the result by the same exact amount and in the same exact direction OVERALL because it is a constant. The FINAL OBSERVED EFFECT (impact point, cant error, or whatever we want to call it) will be determined by that CONSTANT effect (gravity) combined with the VARIABLE (angle).
Michigander has this exactly correct. You have it exactly incorrect.