No, you misunderstood. It's not a literal 100% correlation with the mod notifications, we're borrowing the options but not the content itself. For the mods, yes, the "Email" option refers to receiving emails that contain the notification text themselves, for this (user) notifications section, the same "Email" option would mean receiving the emails that contain the same messages the notifications took them to read.The options could be rephrased:
Web/App notifications and the emails
Web/App notifications only, skip the emails
But here's another idea. I was thinking, one of the the proposed changes for improving the sub settings UI (earlier this year) was a "Web Only" option which if checked would skip the group message emailing part. So here's the chance to do it now. Add the "Web/App Only" option in the Advanced Preferences as a checkbox.
The default is unchecked so no current user impact whatsoever. When the app user (or anyone for that matter) checks it, it stops the emailing-out of the group messages to them. It accommodates the app users' wish, but also gives any user the ability to stop getting the emails themselves but still utilize the message content selections they want, without having to resort to digests or whatnot. They can now have the "All Messages" setting selected and get notifications for them (if they want), but skip receiving the emails. Codewise, should be simple as besides the UI & page code additions, it should only need a check for it before the emailing. The default sub settings screen would also need the UI change.