Here is an update on things:
Disabling the "Microsoft ACPI-Compliant Control Method Battery" does indeed allow me to run the laptop below 7%, however, this method is not a practical workaround because doing so also prevents other useful power management features.
I have an email response from HP and they advise that the
MSDN link is only relevant for systems supporting Connected Standby and that the HP Spectre x360 does not support Connected Standby. They further added that ACPI specification 3.9.4 Low Battery Levels do not specify any value as a maximum.
While I agree with what HP has said is true, I do not follow their logic in setting it at 7%. I understand that a computer supporting Connected Standby would experience a far greater battery drain than one that supports only the traditional Sleep/Hibernate power states. If anything, I expect it to be set at something lower than the 5% maximum of a Connected Standby laptop.
I've even gone out to the shops to sample a range of different laptops - ones from Dell, Acer, Asus, Toshiba and Lenovo. All of these other manufacturers have set the critical battery level to at most 5%. Some are 3% and others even allow you to go all the way to 0%. Only HP laptops fix theirs at 7%. I can only infer that only HP has decided that their batteries are somehow inferior to other manufacturers'.
I've sent another email to HP to see if they will issue some sort of fix, so I'll just have to wait to hear from them again.
(After this, I don't think I will buy another HP product ever again)