If you replace the sphere in Ross's example with a cube or cylinder, you can see this problem clearly. If applied to a 'human character', front on it works, but if the character is lying down it doesn't.
Or, for that matter, seeing a standing character from the side. This is exactly the problem. I know about the spherical map thing, which is largely why I referred to spherical mapping for the shading. However, for the outlines I do the inverted mesh thing. Look in the gallery for a screenshot of my current project.