There's theoretical and there's actual reality at work here. There's a theoretical limit on adhesion given by physics that's the absolute maximum you can go around a corner if all else is optimized, such as carving a perfectly circular line, perfect weight-distribution, etc.

However, in the real-world, there are other variables that come into play that lowers the actual grip achieved below the theoretical level. As already discussed, the line you take and pedal-strikes can cause a loss of traction at speeds below the theoretical max.

What Grolby doens't get is what thousands of racers with years of experience have discovered. That keeping the bike more upright gives you higher cornering speeds. That's NOT debatable, it's born out to be true way too many times to disregard. What IS debatable is WHY you get faster cornering with a more upright bike. Note that this is only faster at the steady-state cornering mode. The turn-in may be a little slower since you have to move the body rather than just throwing the bike down.

The major contributing factor I've found is the better contact-patch when you keep the bike upright. It's flatter due to the profile of most tyres, especially when you've got some wear on it. AND you're not riding on the squared-off sharp corner between the worn and unworn parts of the tyre. I suspect, in the OP's case, if he was riding with his body inline with the bike, that it's actually possible to ride off the rubber close to the skinwall of the tyre. Especially if he tightens up his line mid-corner trying to keep up with the guys ahead. I've learned this lesson the hard way myself trying to keep up with more experienced riders around corners.

I've also raced motorcycles as well and the handling is the same as bicycles. Things are heavier on a motorcycle and it takes more force on the bars to lean over, but that gives you time to analyze the dynamics. And when things starts to slide, it's a lot slower and easier to catch on a heavy motorcycle than on a bike. The main problem with hanging off the side on a bicycle is that you end up catching a lot more air than if you're tucked in on top. And you can't start pedaling as soon coming out of the corners compared to someone who's in the saddle.

BTW - stability and maximum-grip are two completely different things. Sure you can go around at corner at 35mph and be stable. Take it at 40mph and it'll require a lot more attention and corrections, but it's still faster.