"Note that the bitwise operators work on all the bits of the whole byte - so they're not quite equivalent to the Assembler instructions which directly address individual bits."... wrong

The Keil V6 compiler does use bit addressable instructions to modify bitwise variables. I can see them in my output.

Please, no one post telling me the president of Keil compiler personally told you otherwise ! AND Nobody post that the SRC modifier allows the use of bit addressable instructions !