You are confusing two very different features with very different reasons of existence. I understand why that happened, and I will try to explain it to the best of my ability.
The “Login failure” reason corresponds to the “Treat failed logins as a reason for blocking the request” feature. Emails and logging for this reason can be suppressed by adding “Login failure” into “Do not send email notifications for these reasons” and “Do not log these reasons” respectively. I retested it manually just now, verifying that it does work as it should.
However, there is another feature which can send you an email on a failed login. It's the “Email this address on failed backend login” under Logging & Reporting. This will send you a (slightly different) email whenever someone fails to log into the backend (administrator area) of your site. This is not a blocked request, and nothing is logged. As a result, the aforementioned “Do not send email notifications for these reasons” and “Do not log these reasons” have no effect on it. The only way to suppress these emails is, naturally, to remove the email address from the “Email this address on failed backend login”.
The login failure feature is designed to elevate failed logins (in the frontend OR the backend) to blocked requests. As a blocked request, it will count towards the metrics which result in automatic temporary and permanent IP bans. The “Email this address on failed backend login” feature is a purely information feature. It is there just to send you an email if someone failed to log into the backend of your site. It's there to help you catch situations where someone has gone past your first line of defense (administrator directory password protection, secret URL parameter, …) and is now trying to do a brute force or credentials stuffing attack on your site. It will also catch the situation where a member of your staff keeps having trouble logging into the site because they keep trying their username or password wrong. That's why these are separate features even though at first glance you might think they are overlapping.
Now, if you look at the very bottom of your screenshot you will see that you do have an email address in the “Email this address on failed backend login” option. Remove it, and you will no longer receive emails about failed administrator logins.
Nicholas K. Dionysopoulos
Lead Developer and Director
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