If breaking up a procedure results in the creation of a bunch of smaller procedures that are only called once then I think I'd prefer to leave it as it was with well demarcated and commented sub-sections.

It saves you the job of inventing descriptive procedure names as well as jumping between procedures.

I seem to recall also that in Code Complete, Steve McConnell claimed that there was an inverse relation between the length of a procedure and the number of errors per line of code.

How is an inline function different from a demarcated and commented subsection? It seems to me that the semantic and enforced correctness benefits of functions would make using them in this way a no brainer.

This exactly when you break up a logically flat function into subfunctions, the names of those functions are simply replacing comments.

Sounds like it alright but I've never used one as they aren't available in the language I mostly use.