A very good question OP. Or to rephrase, are 0 to low float pedals better for power production at perhaps a fractional compromise to overall knee health. So will share my thoughts as a long time cyclist who has ridden many different levels of float.
When a leg pushes down on the pedal there is a combination of forces at play....both vertical and horizontal components of force. On a good or optimized pedal stroke, most of the force...lets say 99% of the force is vertical because of proper knee tracking. With a pedal that has float the horizontal component of force is lost in terms of foot rotation and this energy is not redirected into a vertical component of force. This is a good thing for knee health. For example I run my Speedplays wide open to not compromise my knee health. To me knee health trumps ANY lost power due to redirection of force by constraining the foot in terms of float. For a racer with an excellent pedal stroke who wants optimal performance, it may make more sense to have limited float to direct all energy from the foot into the direction of crank rotation. With proper cleat and float adjustment this is achievable. But for the average cyclist with less than perfect pedal stroke, to me best case is a high float pedal to optimize knee health for the long term. Much easier for the average cyclist to get it wrong, i.e. place lateral forces on the knee due to a less than perfect pedal stroke and imperfect cleat orientation with limited float.
My thoughts.