Let's face the facts. You run a small business yes, but ultimately, you are still here to please the Man. Yes yes, that's the dirty unrelenting truth. Our endgame is to make customers happy in as creative a way as they'll allow you to do so.
I'll never forget something one of my professor's told me in college about designing for clients. "Sometimes a crappy project, deserves a crappy solution." I don't think he meant you should try to do low-caliber work, nor do I think he was saying be lazy about a project if you don't like the client. The point he was trying to make is that not EVERY job is suited for your most "creative" work. I use the proverbial air quotes here, because creativity is not an inherent fine art, but a skill that you develop. Creativity does not directly correlate with "artsy." So yes, while EVERY job deserves a unique creative solution, not every job deserves your artsy-est ambitions. You have to ask yourself "Am I ready to die on this hill?"
Sacrifice the client for face? Or give in to design by committee?
There's a fine line here to walk. There is no right answer. There is only how much you can take, and still sleep at night. As an artist looking to sell his/her wares in the world, you will certainly be offended. Quite often I might add. And as a small business owner, you have to ask yourself, where is the line between this being a productive relationship and becoming a production artist for the client. There is no right/wrong answer, except this. If I am sacrificing clients left and right for my creative integrity, I am probably not in the right business. If on the other hand, people are beginning to see me as nothing more as a production artist and going elsewhere for their truly creative work, I am probably not defending my design enough. Which brings to surface an important underlying question: Am I presenting my design well, so that the client understands the idea behind the design, and understands that I put serious thought into this (Not time, but thought)? Are they persuaded by my argument?
I find this one difficult in this day and age when presentation/communication rarely happen face-to-face. We must put forth the effort to communicate our reasons for our designs. We do still have them don't we?
And after you have done that, and the client still disregards your thoughts, ask yourself. "Am I ready to dies on this hill?"