This is where common sequences of instruction are abstracted out to form a new function thus reducing code size. If so, then this type of optimization comes at a cost (speed) and is typically provided as a speed vs space option. As for debugging when this type of optimization is in use; if the debug file format is good enough, then it should not matter what type of optimization has occurred
if 3 functions (a, b and c) 'share' some common code (made common by the optimizer, not the source code) and I want to set a breakpoint when function b passes this 'optimized' code; how do you propose to stop there when only function b passes without any difference in operation/timing.

If you plan to come up with something that changes the operation of code under debug other than when the breakpoint is reached scrap them immediately!!!

Eri9k