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According to my manual I can flat tow for 50 miles under 35 mph. So will coasting with the ICE off over 35 mph but well under 50 miles damage my transmission?

The 35mph limitation would almost certainly be conservative, but it would be wise to adhere to it anyway. That doesn't mean 40mph will fry the bushings in the transmission, but going too far above the recommended maximum isn't prudent.

At higher speeds, fuel cut (transmission in a forward gear, closed throttle, engine warm, no brake pedal application) will accomplish the same thing but without the risk of transmission wear. NICE-off coasting has a bigger payoff at those lower speeds where the engine rpm is too low for fuel cut, and you don't want to ruin glide distance by downshifting to L to force the engine rpm high enough to keep it in fuel cut.