it's as if the portrait/landscape adjustment can only be made up to a point a few degrees short of being actually landscape.
Ah, I see.
Since my hutch is so deep and I have that shelf above, the only way I can move into portrait mode is to pull the arm absolutely straight out, and then tilt the iMac so whatever is at the top during the rotation leans forward, otherwise it hits the shelf. (Total height of the below-shelf workspace is less than the landscape measurement of the iMac.)
Given that, in either portrait or landscape mode, it will turn at least 10 degrees past the level point before reaching the stop. I can't test it with the arms folded up like you have yours for the reasons stated above.
tanstaafl.