@GreyWolf
In that specific case ("I ... it's not you ... I've been a real bitch ..." - for reference, chapter 31, Book 1) that I is not a cut-off 'it'. That's Mel starting to say "I've really fucked up", then changing course a few times. She's deeply upset and not speaking very clearly. Yes - I see others read it that way further down, but wanted to make it clear.
I think you're safe on that one, as that's the impression the phrasing suggests. Beyond that, I can't honestly remember the specific reference which triggered my original post.
In the style that I'm using (which is certainly arguably wrong), I'd have written "I..it's" if it was a stuttered 'it'. I use '..' for stuttered letter sounds. "I-it" would also work (and might be better).
That's certainly a unique standard, and as anyone who's ever read my works knows, I've been known to create my own standards (notable using a combination of single quotes and italics for telepathic messages), but you'd want to clarify that early on in any given story (ex: "I..i..it," she stuttered, unable to complete her thought."), other than that, I have no objection to any author using that style.
Usually, authors are given a lot of latitude in the opening chapters of a book to set the story's universe, but the essential thing is consistency. Once you establish a rule, you need to follow it consistently (at least enough to remind them you're still following your convention and haven't just abandoned it after the first use).
Note - it's entirely possible that I messed up somewhere and wrote e.g. "U ... ugh." where I should have written "U..ugh." It happens.
You're right there, as the standard convention is that you only apply spaces around an ellipsis when you're dealing with complete words. For interrupted phrases or partial words, you'd drop the space on either side of the ellipsis, which is how you'd normally see such a phrase in a published novel. P.S. In most cases, you'd always surround an ellipsis in spaces, except in this one case, so it's not unusual a style guide simply wouldn't explicitly state the exception when describing the standard usage (plus, it's really only used in literary fiction, which limits how applicable it is to the general public).
I agree on your 'romantic screams', as authors are all over the map on this (much like adding 23 exclamation marks to indicate the duration and intensity of their ecstatic howls). I don't mind a bit of hyperbole, but think it best kept to a minimum. We get the general idea with only a few characters, and like exclamations, more doesn't actually buy you any that the first two didn't.
Although I've never used dialogue to speech conversions, I often proof my text to help improve the flow and pacing of the story, which is what I base a lot of my timeflow estimates on by having the computer read the text aloud to me (though I've yet to find one which uses the same reflections across the different voices). Otherwise, I think we all amend our initial assumptions when more evidence comes into play, and literary trends tend to begin and end, so it's largely an ongoing process (i.e. "Kawabonga, duce!").