Surely by keeping upright your centre of gravity acts through the tyre (providing more grip) while by hanging off the bike your centre of gravity acts on a point waay outside the bike’s (providing more force which’d cause the tyre to move laterally)?
What I’m saying is, from my (admittedly rather basic) physics knowledge, I reckon that the centrifugal force acting on you as you resist the direction of lean is trying to make the bike sit up, which you deal with by counter-steering. Conversely, the centrifugal force acting on you as you hang off is trying to make the bike lowside, which you (hope!) is dealt with by the grip of your tyres.
In the past I’ve got my knee down by hanging off, and scraped the footpegs by resisting the direction of lean - and the latter feels alot more stable.
This being said, all my knowledge of biking screams the opposite at me, and so I lean into medium- to high-speed corners as is taught and to hell with the laws of physics.
I’d appreciate correction/clarification of the issue, if someone can right me (sorry!) on this!