spfautsch,
I am not sure if the LTCC unit has its own spark tables, but it has its own spark-retard tables and settings. I cannot say if it changes timing during normal, non-knock operation without proof for myself. I grant you it would be cheaper not to bother with it.
But it seems rather certain that it does not control dwell time, only divides it by 8 by selecting coils. If you take the stock dwell time, and give each coil 2 revolutions before the next fire, you will have solved any dwell problems easily without the need to modify anything. Now, you can magically rev beyond stock speeds. Cheap and easy.
As to the lack of power above 5500, that depends if you are using a stock cam or not, or outrunning your injector flow rate/on-time. I don't know any specifics on the engine you mention, unless it is the one listed under each of your posts. The science of dwell time is no mystery to me, but it never hurts to review. Injector on time can pose major problems at high speed, though.