Modern DAWs are typically floating point, and can handle some clipping/peaking without distortion. Some plugs don't handle those levels well, though, which is where you're likely to hear problems.
Not that clipping is ever a good idea, really. Maybe with analog gear, for flavor, but not in the digital world.
I generally set the input gain to get a solid level with a little headroom (assuming we're talking about already recorded tracks, so no surprises) to give the plugs a good level to work with. Then use my last plug (which could be a trim plug, or a compressor, eq, etc) to set the level in the ballpark of where I want it in the mix. Then I'll use the channel fader for fine balancing, writing automation, etc.
Checking the pre-fader level is most important (for me) on buss/aux channels, and the master buss. Summing a bunch of tracks together is where you're most likely to go overboard, I find. And if you're doing buss processing, the plugs may react poorly to that hot level.
There are loads of threads on GS about this subject, read a bit and you'll get the idea (along with playing with the knobs, of course!)