You are correct in that there is no absolute magic number for the x-over. It's what works best for you, your speakers, and the dynamics of your listening environment. Yes, your sub will produce frequencies below 200Hz exclusively and if you don't feel that you're losing any dynamic response below that with your sats, then that's fine. Just make sure that you don't have any dialog coming out of your sub.
Setting the speakers to Small enables the Lo and Hi pass filters so that the higher frequencies will go to the satellites and center, and the lower frequencies will go to the sub provided LFE is enabled (the active sub is turned on). Some subs even have further controls on them to fine tune that.
Unfortunately, we don't know where the Lo and High pass filters kick in (maybe around 4KHz?) so setting the sub anywhere from 80 -120Hz is usually the safest bet. Again, we don't know how what the true dynamic range is of these speakers because how
the specs were determined is not given (anechoic chamber, etc) so it's all a best guess.
A good rule of thumb would be:
Mains = 70Hz
Center = 100Hz
Sides/Rears = 110Hz
LFE = 80Hz
However, we can't set (at least I can't) the individual x-overs other than the sub for our receivers so you have to go on what sounds best to you and a little understanding on what the receiver is doing and how well the sats can handle it.
What you are basically doing is setting the x-over high enough to filter down the lower frequencies so you still have a nice bass effect but also take some of the load off of the sats so they they can reliably reproduce the higher frequencies.
My sats have a dynamic range of 90Hz - 50KHz. Looks good but the human ear can normally only hear about 20Hz to 20KHz, so anything above about 25KHz is all marketing (unless you have a dog with a very discriminating ear for sound
). And, there are no tolerances given for any setpoints along that range so you have no idea where it goes flat. The sub has a dynamic range of 28Hz - 200Hz but I doubt seriously that it can reliably hit 28Hz with any reasonable degree of accuracy. By setting the x-over at 120Hz, for example, my sats will drop off at that point and direct the frequencies below 120Hz to the sub. Even tho the sats are rated down to 90Hz, it's doubtful that they can reliably reproduce that range so I'm hoping that setting my x-over at 120Hz will eliminate any gaps I have in my dynamic range and still take the load off of the sats because of the power requirements needed for the lower frequencies. For me, that's the sweet spot for my setup because I'm getting the best out of my speakers without sacrificing too much on either end. The sensitivity of the center channel is 85dB, and the sats are 82dB, which is fine, but 90dB or greater is what I'll be looking for when I upgrade my speakers.
All of this will probably change for me when we remove the carpeting in the family room and replace it with a hardwood floor in August. At that point in time, I will have to re-evaluate my x-over and maybe even invest in an SPL meter just to see where I'm at. My guess is that not much will change because of the limitations on the speakers.
Audio calibration on these systems is no where near as precise as it can be say for tv's because there are more variables involved.