"Second, if I hack into your computer and get your password to Yahoo Merchant Solution (or whatever processing system you eventually use that does expose the full CC info), I *CAN* see CC info. "
No, you can't. First of all, I don't store my Yahoo passwords on my computer and in addition you would need to:
1) Know both my Yahoo Merchant User Name and Password
2) Know my Yahoo Merchant second Security Password
3) Be using my computer that Yahoo recognizes because of the encryption key installed on it. Or you would need to know a third answer to personal questions I seriously doubt you know.
"Apparently, no one knows of a company offering that." Geez, I just posted my inquiry yesterday so I wouldn't rule out that there might be some other merchants who just haven't logged in yet to see my question.