The proper care and feeding of the in-house graphic designer (from the Jeff Fisher LogoMotives blog)
There are lots of great points in the article, it's a good read for in-house designers and those who work with them. It's also good as a general read for graphic designers and those who work with designers.
I think sometimes, from stories I've heard, that tensions tend to rise when clients and designers have trouble understanding each other. It may be necessary for the designer to give some idea to the client of what's needed to do a great job and what their working process is; but the client also needs to be able to step back and let some things happen behind the scenes before giving input. I think one of the greatest ways to build trust is for the designer to offer to give a little education about technicalities of design to the client. This is a way for the designer to show their expertise and helps the client understand the designer a little better.
Things like colour modes, resolution, and copyrights are good things to discuss in brief. The client doesn't need a ton of details, but they do appreciate knowing when things are being done correctly and knowing that the end result will be better for it.
I used to be an in-house graphic designer. It was something that I really enjoyed and learned a great deal from. I also made myself available to answer questions about design related things. I still work with that company, and they're one of my major freelance clients. I love working with them, corporate design is one of my specialties and I really get to be involved in so many areas of that with them :)
Prior to that, I worked at an engraving shop. In some ways, I think that had similarities to print on demand shops. It's high volume, high speed, and you deal with a lot of customers with different tastes. I always smiled when a customer said "you're the expert, please give me advice." What a great thing to say!
This carries over into design too. I always try to give advice on what I think will help the customer shine and I make a point of asking specific questions about things such as their needs, likes, and dislikes. Approval is always in the hands of the client, but the designer is there to offer creative solutions and help the client to meet their needs in the best way possible. And that's what we all want isn't it? The best possible solution to the task at hand :)