I struggle to think of use cases where so many qualities would be useful. Maybe 4 or 8 more, but 40? Aren't we incredibly limited by belts or Factorio engine itself? I guess inserters cannot swing faster than 1 frame, no? The I/O would be the bottleneck.

It's not just about inserters, there are a lot of other buildings that will use it. Belts can be accelerated or added faster with other mods. I've tried inserters with a rotation of 2000 and 30000 and it's noticeable. I also use the Tweaks mod, where I enable quality in modules and beacons, so I'll use that.

However, if you read the description, you'll find that this mod contains 3 modes. One with 40 qualities, the second with 9 and the last with 10. It's not necessary to play with 40 qualities. Some people just need a few new ones after Legendary.
Look at the pictures of the mod. Here are examples of quality modes.

I went with the 10 in total. It increases the stats by a lot on the last level. I found out randomly that the turret range is the same for the last three levels, is that normal? https://prnt.sc/MPthtjWCE5Cc

Yes. If you see this somewhere, it's limited by the game. This is the game limit (it might be possible to increase it with another mod, but I haven't checked)

The efficiency levels after Mystic (for 10 Q) then jump about every 5 levels. Likewise, the quality between Epic->Legendary is already +2 (even in vanilla), so here it's +5 already at the last 4 quality tiers