With lower max bet you're effectively having a higher house edge for larger wagered amounts.
Please elaborate since a lower maximum bet would only lower variance. How would it affect the house edge?
It doesn't effect the house edge. It reduces the risk of ruin. But mathematically, 1% max bet at 1% edge is the optimal kelly criterion.
Yes, with large numbers enough. With smaller numbers, you get variance. I guess some investors were scared by variance, which I find ridiculous because you are investing in a casino which has 1% max profit and 1% edge, and thus variance is expected when you confront a single whale with such a big roll.