Green Dot / 'S' / 'F' partially represent the Min Drag speeds. Flying with F1 below S is "legal" in most people's books (as stated above) but not very sensible or good airmanship. Drag & Fuel Consumption will increase over the F2 situation, you are the wrong side of the "Drag Curve", you have less "buffer" from minimum speeds e.g. in the case of turbulence / wake, and apart from anything else, have an uncomfortably high nose attitude to maintain level flight....
Personally, if my P2 tries to fly anything more than a couple of knots below S with F1, I try to gently suggest F2 might be a nice idea
Just my 2ps worth
NoD