My company has been using the free address validation provided by UPS. It worked alright in general, but we had too many "false" positives where the system would warn of insignificant changes due to the address' being standardized. Pretty soon the warnings became meaningless and the clients wouldn't heed the warnings of significant problems with the address.
Does your system have a way to decrease the validation strength, so things like "West" to "W" and "Street" to "St" are ignored?
There is no way to decrease the strength of our validation processes. However, just the nature of how our API functions should provide a solution to the problem you mentioned.
If the address in question only results in one candidate being returned, its verified! There is no need to tell the client that we standardized 'south' into 'S'. As far as they are concerned, their address has been validated. What they DO need to know is whether their address as entered is not deliverable. With our LiveAddressAPI they only get feedback if the address is not valid or if more information is needed in order to validate the given address.