Most commercial grade analog modulators the cable co. use have a switch on them to enable audio limiting/compression. Of course, these are NOT high grade compressors, but probably something along the line of what they used to put in VCR's. And it is totally unnecessary to use it when the are remodulating the satellite channels, since the programmers ARE using audio processing on their end to compress their prog some, since just like a radio/TV station, they cannot exceed a certain audio level on satellite uplinks.
But, since most cable techs probably do NOT want to be bothered to take a few extra minutes & properly set the modulation levels on the modulators, it's easier to just crank up the input level, flip on the limiter switch & go on with business, since the majority of their customers will NEVER know the difference - actually, most would rather have it VERY compressed, so they do NOT have the large volume swings on their TV sets.
Now, if you are having audio issues on your analog OTA locals on cable, it may NOT be the cable operator's fault. Most cable co. that pick up local channels OTA, use heterodyne processors, which only move the station from it's OTA assignment to whatever channel assignment it is on the cable system. (this is NOT a demod/remod device) So in this case, you are getting EXACTLY how the OTA station is doing the audio processing, which to quote you, can be "atrocious" in itself - the cable co. CANNOT fix this in this instance.