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I've looked through your help/faq and can't seem to find the answer to this question...

Say somebody orders two items. The shipping selections for both of these are "small box" with capacity of one. Does the shipping calculator assume that these will be shipped separately, or is it capable of recognizing that we will ship these items together in a larger box?

Should I just select a box with larger capacity for these items so that if more than one is ordered they get charged for only one package being shipped?

You can either configure products for shipping multiple units in a larger box and then just use a smaller box when warranted, or configure for shipping single units in a smaller box and then just consolidate into a larger box when warranted; either way, you'll sometimes wind up a bit ahead, so you can refund or just pocket the difference.

At present, our system is only smart enough to consolidate different products into the larger product's container when the Tube package type is used (as for posters) -- if you order large posters in a large tube along with smaller posters, the system will consolidate the smaller posters into the large tube. Since that configuration is done "behind the curtain" (buyers don't see which package type you are using), I don't think there's any reason you couldn't configure your boxed-shipment products with the "tube" container type, so ordering a larger product would then allow smaller products to be consolidated into the same large package container, even though you're actually shipping in boxes.