I set the soft limits for Z so that the head stays within it's limits.
Not to stop the cutter chewing up the table.
The head does not know what the length of the tool is so it is not much good using the physical limits for that.
When you put a cutter in you need to set the Z reference point, being the end of the tool and the top of the job (usually).
I put in the new cutter bring it down the the job, or a spacer block, and hit zero, or enter the height of the spacer block in the Z DRO. (and hit enter)
Now Z zero is at the top of the job.
If you measure down to the table or vice base with a ruler, and set slightly above this value value in Z-Inhibit field on screen one (it will be a negative value for below the top of the job).
This prevents a program going any lower than this value, but you can still jog down if you choose to.
With a drill cycle I often set this to minus a small amount, and zero the DRO with a center drill. Now I run the drilling cycle but the depth is limited to just spotting each hole.
Change to the drill. Run program with Z inhibit off, or set to protect the table, of the vice now.
For these limits to work you select Z-Inhibit ON (flashing yellow I believe) or you won't be protected in Z !