With more critics piling on to the just-say-no-to-Yahoogle bandwagon–questioning the controversial ad deal for Yahoo to outsource some of its search ads to Google–sources said some top Google execs are now hightailing it to Washington, D.C., to smooth over any regulatory feathers the company might have ruffled with its aggressive, damn-the-torpedoes approach to pushing the deal forward.

The partnership is set to start up around Oct. 13 and promises to give the much-suffering Yahoo (YHOO) a huge boost in revenues.

Google (GOOG), of course, benefits by blocking Microsoft (MSFT), which has caused the software giant to lobby against the deal like a lipstick-wearing pitbull.

Google and Microsoft have been locked in a variety of tech battles on many fronts of late, but the Yahoo front has been a particularly rough one.

Critics like Microsoft have a lot of ammo here though, especially because Yahoo and Google together will claim over 80 percent of the search market.

That has caused a big outcry to prevent the No. 1 and No. 2 players from partnering.

The latest objection, among a passel of them, came earlier this week from the World Federation of Advertisers, which has asked the European Commission to stop the partnership, even though the deal, as currently conceived, impacts only U.S. Web sites.

So to assuage the tumult, Google is glad-handing regulators, even as Yahoo announced a new group for advertisers called the Digital Advisory Council.

“Opening up Yahoo! is a key part of our strategy, and we want to help advertisers understand how they can benefit from this approach,” said Yahoo U.S. EVP Hilary Schneider. “At the same time, there has been confusion and misinformation surrounding Yahoo!’s agreement with Google, which represents another key milestone in opening up our network. As questions emerge about how Yahoo! will implement this agreement, the Advisory Council will provide a forum for us to engage in a dialogue with key customers on those issues.”

Well, phew! A council! That’s sure to bring online ad harmony across the planet!

Actually, it all feels like that model United Nations thing I grudgingly did in high school, and almost as useful.

And the pair also got a boost from New York Times Digital Domain columnist Randall Stross, who penned a piece Sunday called “Why the Google-Yahoo Ad Deal Is Nothing to Fear.”

Nothing? Really? Not even a little bit?

BoomTown has got to say, we’re still a smidgen nervous. OK, tons and tons. (And, it turns out TechCrunch’s Michael Arrington agrees with me, so you know it is serious!)

Still, in the interest of fairness, let’s examine Stross’s main argument, which is essentially that Google’s and Yahoo’s more than 80 percent market share does not matter.

“Google controls about 70 percent of the search advertising market. Doesn’t that give it a monopolist’s ability to set prices as high as it wishes?

“It does not. Google does not set the prices. Its advertisers do, bidding against one another for the amount they will pay when a user clicks on one of their ads. They do the same for ads on Yahoo and Microsoft search sites, too.”

Noting Microsoft’s efforts to portray Google as a “price-controlling monster,” Stross then tried to make a case that worries about higher prices are currently just speculation and not based in practice.

“Even though this is a business based on auction pricing, the specter of price fixing has been raised by demagogues. Shout ‘monopoly’ loud enough and point to ’90 percent share’ of something–it doesn’t really matter what–and federal and state regulators will decide this is a matter meriting their close attention.

“One company has done more than any other to publicly disparage the Yahoo-Google deal: Microsoft, the same company that did not succeed in acquiring Yahoo earlier this year. Hell hath no fury like a suitor scorned.”

Oh dear, the loser-boyfriend argument, which is a canard.

Sure, Microsoft is up to all sorts of tricks and aggressive lobbying about the deal–just as Google surely would be if the tables were turned and Microsoft had won the heart of Yahoo CEO Jerry Yang and consummated a merger marriage.

And Google and Yahoo are correct that the auction model means advertisers set prices for ads.

But what Stross is leaving out is the key problem of what happens later, when perhaps Yahoo’s share of the search market declines even further–as is the inexorable trend–and Yahoo becomes yet another vassal of Google’s largess.

That’s now true for AOL, Ask, MySpace and many others. And it is in no one’s interest–especially publishers–to have just one place to turn, which is what they will have, since Google will increasingly yield the best results.

Last week, for example, I was meeting with a big advertiser on both Google and Yahoo, who noted that he liked to have two strong choices.

“In the end, as Yahoo’s results weaken, it will probably only make sense to use Google,” he said. “And that opens up a whole can of worms.”

Indeed. Which is why–at the very least–regulators should force Google and Yahoo to make some commitments about their deal.

The kind of trust-but-verify-later requirements that anticipate possible problems was well argued in the form of a white paper yesterday from a nonprofit think tank called the American Antitrust Institute.

The report was relatively even-handed, noting, “the transaction should be viewed as presumptively anticompetitive, although it may also contain possible pro-competitive benefits.”

So, in the interests of consumer and advertisers and publishers, it is incumbent on the government to get tweaks to the Yahoogle deal that minimize the former and maximize the latter.

Without such promises, who knows what tomorrow brings in a world in which one search engine survives?

Please see this disclosure related to me and Google.

Okay, a show of hands of those who don’t want to hear another word about how incompetent the other side is in the now-settled proxy fight between activist investor Carl Icahn and Yahoo.

Icahn, whom Yahoo insisted last week was unfit to even turn on a computer, now appears to be perfectly capable of leading the troubled Internet company as a board member, along with two cronies of his choosing (with Yahoo’s consent).

What’s not clear–except for removing uncertainty and noise–is exactly what this means for shareholders or how it gets Yahoo (YHOO) back on track or even how a possible deal with Microsoft is now struck.

BoomTown honestly does not know what to think of this development, given that Yang seemed to have the upper hand in the fight after Icahn started looking too greedy in a power grab with Microsoft (MSFT) for Yahoo assets in recent weeks.

Why then give in to Icahn now? I guess to stop the annual meeting on Aug. 1 from being a three-ring circus and to take the focus off of the battle right before Yahoo announces its second-quarter earnings tomorrow against a strong economic headwind that already knocked over both Google (GOOG) and Microsoft.

(And, by the way, Yahoo’s proxyfacts.yahoo.com attack on Icahn is now miraculously gone!)

From a let’s-be-safe perspective, it’s the right move, shutting up Icahn a little bit. He’s still going on about doing some sort of Microsoft deal, of course, in order to recoup his losses on the shares he bought in Yahoo.

But unless the newly constituted board is now jetting up to Redmond en masse with a magic potion that will convince Microsoft to fork over $33 a share (remember, the old board members will get sued if they accept less), Icahn might have to cool his heels a while before Yahoo excels again.

In fact, with the old board in place–minus Activision (ACTI) CEO Bobby Kotick, who has got to be breathing a deep sigh of relief, since he does a lot of business with Microsoft–and the Icahn trio, it feels more than a little unwieldy, block-prone and probably deeply confusing.

Kind of like the United Nations, but not as well organized.

So, you get the picture of how an 11-member board works, right? The lugubrious quicksand of Yahoo prevails!

One hopes Yahoo CEO Jerry Yang–who kind of played BoomTown and the rest of us with his genuinely fake emotional expressions of horror about Icahn and distaste for Microsoft for joining with him–is now prepping another Oscar-winning performance to convince Microsoft CEO Steve Ballmer that he likes him, he really likes him.

Still, it’s nice to see former AOL head Jon Miller added to the list of possible choices for the Icahn seats.

At least the definitely competent Miller is someone who knows a thing or two about reviving an iconic Web brand in turmoil, from his stint taking over the Time Warner (TWX) unit just after the merger with AOL failed and everyone at AOL bugged out carrying sacks of money.

Speaking of sacks of money, Icahn does not get one here and neither does any other shareholder in this scenario. It seems that now the real work will begin for Yahoo.

My prediction, given the amount of bile Yang has been throwing at Microsoft: A delegation is already knocking at the door of Microsoft HQ talking about a new search deal it is willing to entertain now that Icahn taking over Yahoo is not the sticking point.

Because, for better or worse, Icahn has been bought and paid for by Yahoo.

Now, perhaps it is Yahoo’s turn to get the same treatment from Microsoft. Unless, of course, Yang has another big idea for turning Yahoo around.

In that case, Jerry, we’re all ears.