I would say more than the importance of the brake cable length is whether it is allowed to flex or not. Grab any mechanical brake lever and watch the housing flex. Removing distance does inherently reduce the capacity for it to flex, but it is not the only variable in the squishy feeling. My brake housings on my DH rig are long as all get out to adjust for 8.5" of travel and a 46.5" wheelbase, but I did it so that they have very little room to flex when I compress the brake lever. That being said, I would take my BB7s over BB5s any day of the week. I used those BB5s for probably 3 years and never was satisfied with how the rear stopped. The front always stopped perfectly, but that rear just sucked.
If I remember correctly, the housing/routing going to the back of Johnny's hardtail is probably as short as its going to get. When we were installing the rear, there was some sticiton when we compressed the rear brake lever to when the pad actually contacted the rotor.