What you are missing is that the crossover for the LFE out affects only the LFE. You do not want it lower than 80Hz, the typical bandwidth limit for the LFE channel. I usually leave it at 120Hz.
The redirected bass from the other channels is limited to the cutoffs you set for each main channel. In your case, L/R are sending only <50Hz and the rest only <60Hz (nominally).
I do not understand the logic behind this statement. There is no reason to "free up the subwoofer bandwidth."
In theory but to what effect?
First, (and most important) that setting affects ONLY the LFE and not the rerouted bass, so it is independent of any of your other settings. LFE bandwidth extends to 80Hz and may extend, per spec, to 120Hz. You don't want to delete any of that information.
Second, power resource requirements are reduced as the frequency rises, so deleting upper bass frees up little.