Do the decal sub-materials have the "Decal" box ticked? It's an obvious question, but the checkbox fixes some of the z-fighting issues, so maybe it can help.
http://udn.epicgames.com/Three/UsingDecals.html Use decals sparingly. Vertex Blending is usually a better option, but decals are a quick and good way to get small changes on geometry.
You should create a default Decal UV layout, to which you try to conform all cars and all decals, that way you don't need to create a new unwrap for every decal, which sounds like a bad idea (too much work, impossible due to max 4 UV's).
So basically you're asking if its better to have a decal sheet or to keep as many decals on the texture for that model as possible? I wouldn't know but was just clarifying the question.
Haha Artist_in_a_box i'll take that as a compliment :p and thanks Mooglesarelittle, i'll clean up the stairs and make some graffiti decals , I actually have a lot of decals to make!