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Also, most of the other voltages on the PSU (like 3.3V) are only able to provide a very small amount of current, so there is no sense in using them.
Actually, because they are of lower voltage, you get more amps out of a 3.3V wire than of a 12V. I am looking on some thermaltake PSU, and while the 12V supply is rated at 14A, you can get 24A out of 3.3V. Remember that 3.3V is used to power the processor, and that is a big power hungry beast, not your average ATMega640...
You, my friend, have stumbled across an almost perfect lab bench power supply. Check out these sites.[Snip]Hmmm this one seems interesting. It has a variable voltage supply circuit in it.
Oh and as for stability, I'm pretty sure it's take care of in the PSU itself.
The real trick is that there is a "sensing" wire that is used to tell the PSU to turn on.