As of now, Spiral Knights have three different settings low, med, and high; and there's some other options.

should there be a setting before/below "low"?

a setting where the detail is minimum if not none; for example the floor tiles, the bushes, and the background(it could be a still background). the flames at vanaduke could be still flames, and all the lighting could be dimmer. the animations could be minimum, for example pop ups, attack and defense/shield, enemy death animations. the game could look a lot plainer.

people with crappy computers will still buy into the game, as long as the game runs well.

i don't think anyone would mind sacrificing quality for smoother gameplay; though most players lag because of connection problems.

thanks for taking the time to read this, really hope i can get response :)