You’ve got quite a low dT (difference between flow and return temperature) - less than 2K. So the 0.4 K underestimation of the flow temperature leads to an underestimated heat energy and thus COP of more than 20%.
No worries, all this gets quite confusing. I am not aure what exactly the expanded mode does, I’m using the pure weather compensation myself.
Your understanding of the weather compensation is correct. The key to understanding the cycling is that the system aims to keep the flow temperature constant but fails to do so because it can only deliver more power than required.
Let’s look at a hypothetical example. Say the target flow temperature is 30°C and it’s 10°C outside. At this outdoor temperature, your hypothetical house requires a heating power of 1kW to stay at your desired temperature, let’s say 20°C. The hypothetical radiators in your hypothetical house are dimensioned so they give off 1kW of heat at 30°C flow temperature. So far so good, but here comes the problem: the minimum power your hypothetical heat pump can modulate down to at 10°C outdoor temperature and 30°C flow is 2 kW. This is far too much and would overheat your house. So the heat pump cycles and is only generating heat for 50% of the time so the average power is exactly the 1kW you need. It basically overheats the flow temperature above the 30°C target and then circulates the warm water around until it has dropped below the target value. If you average the temperature over time, you get 30°C, the actual temperature just oscillates around that value.
All this is not influenced by the target room temperature. The cycling will keep you room temperature at the desired spot if the weather compensation is correctly set. There will also be some minor oscillation of the room temperature that follows the flow temperature oscillations (slightly delayed and smeared out). So if you want 20°C, the temperature might oscillate between 19.7 and 20.3.
If you start out at a lower than desired temperature, you have to work your way up to your target at first. How quickly that happens depends on your house. If you had a heat survey done, they might have estimated a heat capacity of the house. This will be something like x kWh/K and means you need to supply x kWh of heat to heat up the house by 1K. Say you start at 19°C desired room temperature and switch to 20°C. Your heat pump now outputs an average of 1 kW heat. At 19°C, you only lose 900W to the environment, so right when you switch to the higher temperature 900 of the 1000W gets used to keep the house at 19°C and 100W goes towards heating the house up. This way the house works its way up to the final temperature, which can take a long time if your house is quite massive.
I hope this wall of text is somewhat helpful 
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