when is it correct to call on the button?

[car ramrod]

I've been thinking about this lately. So far this is what I have came up with:

In the past I would raise KQo or AJo on the button no questions asked. But lets say there are 4 or 5 limpers to you and the blinds are very loose. So we can expect at least 7 people to see the flop.

I think this is a good spot to call rather than raise. My reasoning is as follows:

KQ or AJ are great hands, but offsuit they mainly rely on tpgk to win. With 6 or 7 people in the hand tpgk's chance of winning goes down. So if you raise you are bloating the pot, as most of the time everyone will call the raise as there already in for 1 bet. By bloating the pot you are letting gutshots and other 4 or 5 outers call you correctly. By just calling pf, you now keep the pot a little smaller and have a better chance of protecting your hand, or at least you can make people make mistakes by calling with out the odds.

This maybe common knowledge to some, but I have just lately thought about the reasoning behind it.

Also, if this is the correct play, how good of a hand do you want to raise in this spot, or how low do you go with a call vs a raise.

thoughts?