I know exactly what you are talking about. In my opinion the problem with most model gravel roads is that if you try to use separate stones they are as a rule way too big, way bigger than true road gravel is. Gravel in a gravel pit is one thing -- more like ballast in size -- but they crush it more than that to use on roads or alleys. There it tends to range in size from pea-size to maybe an inch or so, and that is incredibly tiny in HO. I mean, imagne the finger tip or thumb size of an HO scale figure! So we are in essence trying to make rocks look like pebbles and stones.
The other problem in my experience is that people want visitors to see the ruts so they make the ruts too deep in both dirt and gravel roads, without giving thought to whether anything other than an army vehicle could actually drive through.
If you could magically reduce a true gravel road to model railroad size I think we'd be surprised by how relatively smooth it looks. Not glossy smooth, not poured concrete smooth, but smooth.
On my layout I have a macadam street -- where they laid down hot tar and then small pebbles, with sometimes a roller pressing them in but often letting the traffic do that part of the job, and for that I used the reverse side of a roof shingle -- basically a textured but flat and even surface, and painted it appropriately to show more of the black tar where the wheel traffic is the highest. On the edges and center line, where pebbles tended to gather and NOT get ground into the tar by passing traffic, I used the very smallest "limestone" ballast I could find, a Highball product intended for Z scale. It is almost dust like. The effect looks good to the naked eye, but a digital photo I took shows that even that ballast is a bit big. But thus far I am pleased.
The plastic that is used for milk jugs and cat litter jugs and some other household products has a similar, slightly orange peel like texture, and when cleaned and painted and roughed up a bit with a sanding block also has something of the look of a smooth gravel road, and use the real stones -- again I'd explore Z scale ballast or maybe the finest sand you can find -- for the non-compacted stones that tend to gather at the edges away from the tires, or should I say tyres? The one problem with that kind of plastic is that getting paint to adhere can be a challenge.
This may sound nuts but the textured plastic of such things as computer cases and other consumer products and product packaging, if properly painted and weathered, would have a pretty good approximation of the texture we seek - a suggestion of slight roughness but no separate rocks or stones to distract us. A bit of dumpster diving may be in order!
Another idea that I have thought about but not yet tried out is the finest grit sandpaper or, maybe even better, finest grit emory cloth (for its greater flexibility and, I assume, resistance to humidity). Again what we are after here is a texture, a suggestion of separate stones.
Dave Nelson (a proud descendant of Australia's Becker clan, mostly NSW)