In addition, if you are running LOP then a lower RPM effectively advances the spark closer to the ideal point, generating more usable power. So lower RPM helps efficiency due to a combination of
1 - Lower pumping/friction/induction losses
2 - Higher AoA on the prop (hopefully closer to best L/D)
3 - Better ignition timing if LOP
4 - Others... ?
Clearly too slow and you start to get excessive pressures and temperatures, which could cause detonation. If ROP you can get the spark sufficiently 'advanced' to cause pre-ignition.