I have to have the volume levels very low on my card, but with the master volume set to the 2nd notch, the wave volume provides me a complete range from quiet to loud with enough steps to satisfy me.
I guess your card is an even more extreme case than mine. Note that the volume control in Winamp, for example, changes the wave volume, not the master volume. Changing the master volume on my system has the same result as your system, a few steps make it too loud, because the master volume is cumulative with the wave volume.
<img src="https://www.feldoncentral.com/volume.gif">