Why does a cutter rig point higher & sail faster?

I don't think observations of racing rigs is very valid. There are so many design and operational issues that drive the optimal racing rig.

A racing boats SOR and design is driven exclusively by the lightest rig that will drive the boat with the most power to suit the righting moment. Around the buoys the speed of sail handling is also critical. Also a buoys racer isn't interested in the best long term SOG, just the fastest direct buoy to buoy route.

Long leg racing boats as you say use multiple headsails very effectively and for good reason. Ditto for cruising boats.

 

It's a complicated question. As a general rule first you go faster and then you point higher. Maximizing VMG for upwind performance is always a tradeoff between the point of maximum efficiency considering the rig alone, and enough extra power to overcome all the other forms of drag. Other consideration is high wind speed where you need to depower below maximum efficiency, and low wind speed where you most likely need to power up beyond maximum efficiency. Fractional rigs like on a Star tend to offer the most flexibility over a range of wind speeds without reducing sail. Full rigs offer less flexibility in the mast, but better opportunities to increase and reduce sail. Another difference may how easily a boat can exceed it's hull speed upwind. If it can, it still needs efficiency but tends to go for more power to foot lower but faster with a lower aspect ratio masthead rig. If it cannot, but is otherwise very sleek and stiff, it tends to maximize pointing ability by going to a higher aspect ratio fractional rig. Boats naturally want to tack through 90 degrees, but they want to avoid the 'wall' created by hull speed, so if the can't exceed it, they point higher to avoid it, and if they can exceed it, they point lower to get over the hump. Then there are really slow boats, like cruisers with lots of payload, or hauling a tender, excessive freeboard, and excessive parasitic, friction, form, and wave making drag. These go low and slow, so we make the most of it by powering up as best they can with whatever we've got. These can be lots of fun to play with as there can be some novel ways make the best of the situation, which often go well beyond full rig vs fractional rig.

 

Double Headsails vs Fractional & Masthead Sloops

It will be interesting to compare most of the quotes on page 1 of this discussion with a recent posting I made in 'Sail Aerodynamics' entitled,...
Double Headsails vs Fractional & Masthead Sloops