I don’t think we have a clear reproduction yet.
My understanding is that @JammyDodger is trying to reproduce this issue based on your report, but has so far been unsuccessful.
A few notes:
To clarify, this is not a channel-wide setting, but a user preference for that channel. But what you’re showing are the defaults, so I’d suspect that most of the 313 members have it set that way.
Are you sure they were away? If they were on the site, then the notification will not send an email.
OK, that’s pretty strong evidence that something isn’t working as expected here. I would have guessed that more than 2 out of 313 people would be away. Is is possible that they were all on the site at that time?