> isn't startup done before processing .emacs?

Yes, but (after my recent change) Emacs also looks at text-quoting-style after 
processing .emacs, and adjusts the display style accordingly.

> I don't yet have `text-quoting-style' in my .emacs

Please try adding (setq text-quoting-style 'grave) there.

> I've not seen any shadowed quotes on my screen no matter
> what I've done.

Please try loading the attached file; after it, every occurrence of X, Y and Z 
on your screen should appear in different faces that are readily legible.  If 
faces aren't working for you, we need to investigate why.