I haven't played with the Literary Digest enough to know how to optimize it.
For your other questions: there is no benefit to self-publishing once you're a strong enough writer to sell to a publisher, and there's also no drawback to publishing a poor book AFAIK, other than that the royalties are probably lower for a lower quality book. There's no limit to how many books you can sell to publisher, and the publisher royalties are so vastly higher than self-publishing, even for a poor book. The only advantage of self-publishing is that you can do it with much lower skill so you have access to it slightly earlier in the game. (I generally have my writers stockpile their books until they reach a high enough skill to sell to publisher, then sell all their previous work to publisher at the same time.)
It could be fun to roleplay something with a purposely unpublished manuscript. Maybe someone here has. I personally haven't. I'm sure people have all kinds of fantastic ways to organize their writers' output in their homes (or bookstores).
I've never seen an old book make a comeback, but that's a fun idea. Get Famous does have a chance card where a writer's recently published book gets optioned for a screenplay.