So I was looking at those cards...

Stunning Blow says that you use your UNMODIFIED DAMAGE VALUE in the attack with Incapacitate....

Homing Device gives you a -1 to damage but lets you take away stealth with a close combat attack.

So what I am getting her is if I use both of them together then I can override the -1 penalty due to the restriction of Stunning Blow...Am I correct?

It would appear so. Check with your judge before attempting to exploit this combo though.

An even easier way around Homing Device's damage penalty is to simply give it to a Giant or Colossal character (Giant's being the best, in my opinion).

Since the damage penalty only applies to the "starbust" damage symbol (regular characters), Giants ("giant" damage symbol) and Colossals ("smashing fist" damage symbol) do not have the penalty applied when they use the feat. Giants are slightly better than Colossal characters, too, since the feat only activates on close combat attacks, and Giants have that two square radius thing going on for close combat.

Cool thanks.

I knew about the giant/colossal thing....I'm just playing E Star-Spangled Kid with Stunning Blow and thought about putting Homing Device on her to help with Stealth for my JSA team....