maybe malcom could refresh us on the issue , but as I understand it
1.the external pwm chip has 4096 steps
2.the loop update time is in 1 sec intervals
3. the desired fade in /out period divided by the loop time yields too few "pwm" steps for a smooth looking transition if you simply divide 4096 by the number of available steps

my theory is that if the steps are chosen well the effect may be smoother