No surprise I suppose but this turned out to be very true.
There was one thing I forgot to mention: I installed the True 3D Sound for heaphones mod after following your instructions above, and before starting a new game. Silly, I know. It just didn't occur to me because I regarded that mod to be ultra safe and not conflict with anything. Big mistake as it turns out, because I found this in a support post "The DLL file included in this mod caused me to CTD upon starting a new game. Was tearing my hair out trying to figure out what mod it was in MO2, and even on an unmodded game, only to realise it was this. Everything works fine without it installed."
followed by:
"Actually I'm willing to bet you have Alternate Start - Live Another Life installed. This 3D Sound mod is not compatible with the starting prison cell in that mod, because those cells have some custom sound settings in its ESP that seem to not play well with 3D sound (in my experience normally when having Immersive Sounds Integration installed as well... possibly due to a conflict with that sound mod and the ASLAL cell). Simply rename the DLL, start the game, create your character, leave the starting cell, then name the DLL back to its normal name. Voila! Working 3D Sound. Just be sure to remember to rename the DLL temporarily again if you start another new game. This DLL doesn't affect your save in any way, so it won't harm anything to disable mid-playthrough."
That mod is old now by the way. The newer version is Binaural 3D Surround Sound for Headphones - HRTF.
But there are two issues with the new version as well:
1. The sound conflict is still there - I got a CTD before arriving in the cell of ASLAL.
2. "Audio Overhaul is not compatible for some users." (from the description page).
Issue 1 can easily be avoided by doing the highlighted text above (from the support posts), or by doing like I did; simply wait to install it after leaving the ASLAL prison cell.
Issue 2 I have no clue about. I have Audio Overhaul installed (as per the Skyrim SE guide) and I don't have any issues. Yet.
The mod can't be installed using MO2 or Vortex. Just like ENB the files have to be manually copied to the Skyrim SE game folder. The files look like this:
So the dll file and the hrtf folder containing the mhr files go into the Skyrim SE folder. But they have to be removed every time you want to start a new game (using ASLAL) and then copied back after leaving the cell. At least that's my experience.
Just thought I'd mention this here for completeness sake.