Thanks GD. I appreciate you talking through this.
Here is what I am thinking. Purpose of the EGR system is to cool combustion slightly. Since all of the timing and blending and ratio stuff is interconnected, taking away that cooling effect could cause an increase in combustion temperature and... bingo! If, as I think it should, the ECU ignores the knock sensor at low RPM and load conditions that would further explain why there is no automatic correction happening until the engine speeds up.
You are 100% correct about when the EGR is functioning. I did not know before but I have been looking into this over the past few days. EGR is closed at idle and WOT. All the rest of the time it is passing a small amount of exhaust gas and the system is tuned to allow for it. Only piece that is missing is the P0401 error code. If I had that I would be certain. Anyway, I flushed the EGR system last night so I am sure there is a good flow and we'll see how she sounds today. As I mentioned, the car's performance is exceptionally smooth with better than expected fuel mileage. Only the pinging sound is at issue.