From what I believe the crosswind limit is reduced? Unsure of the reason though...Am I being silly?
Think thats correct. Adding winglets increases longitudal stability
which again requires more rudder input.
I think you mean directional stability, not longitudinal.
And the most likely reason for a xwind "limit" change is that no larger value was demonstrated - in many cases so-called crosswind "limits" do not represent actual limits but rather the largest value demonstrated by the OEM, which may well be annotated as "not limiting" or similar words by the OEM; nevertheless, many people do treat the demonstrated maxima as operational limits (and that's a reasonable thing to do, IMHO).