How does the ignition advance work?

[Fazerider]

The wires are as follows on the Sensors:
L/Y is the positive feed
W is the signal output to the Ignitor, the Speedo and Odometer from the Speed sensor
B/L is the earth fed from the ignitor.
W/R is the signal output to the ignitor from the pick-up
Y is the signal output from the TPs to the ignitor
L is power from the ignitor
Speed sensor pulses over either 12mph (20 Kph) are not used by the ignitor as all timing timing above that road speed is controled by the TPS angle and engine speed.

Good work!
I'd realised the power and signal wires for the speedo must be the other way round from my initial guess since the ignition must be aware of the pulses in order to produce the 4000rpm fault warning on the tacho. (Though why you'd notice that, but not a dead or erratic speedo reading is a puzzle.)
So what is the purpose of the low-speed adjustment to ignition timing? Does retarding it slightly improve rideabilty or something? Perhaps that would be why I'd not noticed any effect since most of my commute is well above 12 mph.
It does raise the question of whether dyno test results are invalid since most seem to involve the front wheel being firmly clamped. Perhaps those who've tried and failed to get decent results with rejetting for pod filters have fallen foul of this?