Your assumptions are more-or-less correct.
In my own experience if you have water in the bottom of your fuel tanks, this will indeed freeze when the temperature drops low enough. The effect is to block the fuel drains, making it impossible to get much more than a dribble out of them.
On the more general point about the period between 0 and 350 hours and the risk it carries, whilst it feels as though it should be correct, it does not tally with CAA stats.
2D