"I try to put all of my logic in stored procedures for smaller and mid-size applications. "

I do the same. My philosophy is to use stored procedures to transform data into information, then make that information available to application programs. The dividing line is generic vs. specific: if a certain type of information needs to be made available to all applications, I put the logic in a stored procedure - if it is specific to one application, provide that application with the necessary base information and let the application code perform any additional data manipulation needed.

It helps that the applications involved are analysis intensive and don't use all that much data - this philosophy might work poorly when applied to a few million ATM transaction records in a terabyte database.