The 100W limit is not only caused by the relay.
The 100W (music power) limit is applicable for the not to the speaker connected amp.
The moment amp A is connected to the speaker the amp B is loaded with a 100W dummy-load (not specified what load that is,
@Amir could measure the resistance of the not used input). Most likely the dummyload resistor is not capable of handling 100W continuous, it would need a huge heatsink for that.
When overloading smoke might come out, the resistor may burn out maybe even scorching the PCB.
The other limit is the 250V/5A rated relay. This tells me this is a relay intended to be used for switching mains power. In general these relays 'weld' a bit when a high current is passing through them and this makes these types of relays (in general) less suited for switching low power levels as there is no spark and contact depends on contact pressure and contact material in that case.
5A in 4ohm means 20V input voltage = 100W, 5A in 8ohm = 40V = 200W
The distortion
could be caused by the load the meter circuit applies,
could also be the relays that do this or even a combination.
The main difference the mkII seems to have is a (small) audio isolation transformer is used in the audio path to the meter circuit.
That could add the distortion and might explain why it seems to saturate/stabilize.
Above 1.7V the distortion seems to rise about 5x (still only 22μV opposite 4.5V) but.... 0.0005% is still inaudible and only measurable.
It could thus be the extra load (transformer) or the relay contact (no spark, so pressure contact only) or even a combination.
That transformer may not have been in there in the original version and its purpose is to ensure there can be no LF 'leakage' from mains (via the wallwart) into the connected amps which
@amirm showed to be there.
In order to find out a bit more one would have to apply the load not through the relays but before the relays. When distortion still increases it is the load the VU3 applies.
When distortion does not increase it is the relay contacts that is the culprit.