Back in my RAF days we used to practice aural homings on beacons on 121.3 using the same technique as you describe. I recall winning the Lord Trophy a RAF Search an Rescue competition that was held annually. Our homer only worked on 243 MHz so anything on 121.5 had to be done manually. The diameter of your circle seems a bit low from what I recall, but the altitude was probably lower than we used. I doubt that the bandwidth of an ELT is particular low and could easily be 25 Khz, quoted bandwidths refer to the half power point and at say 60db down will be very much wider. By selecting the receiver to the next channel there is a fair chance that if the ELT signal is strong enough some of it will be picked up. It is equivalent to placing an attenuator in the antenna and working with a weaker signal so that close in it will be more sensitive resulting in a better overhead estimate. Sounds like a neat trick discovered by doing it quite a few times.