Before I set about patching nodereference.module's _nodereference_potential_references() to avoid the "this post can't be referenced" validation error, I just want to check:

There's no way for a custom module to implement and override the hook_field "validate" operation, is there? That's only invoked for the module that defines the field?

Is there any other approach to this?

The reason I need to do so is that I'm using the Domain module, but I need nodereference fields to be able to reference nodes assigned to any domain, not just the current domain. See Allow access to all nodes via nodereference only?