Yes, it would only be 2.5% applied to all the units.
the quick math says that it is bigger than the benefit of adding the extra 1 width:
You already have 80 width of power and add 1 => 1/80 = 0,0125 or 1.25%
About why 40 width is better, we have to see how attack and defense/breakthrough works.
At each combat round, all division in a battle attack one of the division in front of it.
Let say we have division build in the following way :
20 width : 100 attack / 100 defense
40 width : 200 attack / 200 defense
If the total amount of attack inflicted to a division is lower than the defense, 10% of the attack will deal damage.
If the total amount of attack inflicted to a division is higher than the defense, 40% of the attack above will deal damage, and 10% of the attack below will deal damage
In our case, the 20w will have 200 attack combined against 200 defense of the 40w. Thus, only 10% of the attack will deal damage, so 20 damage
Then the 40w attack one of the 20w, it has 200 attack against only 100 defense as it target a division. Thus 40% of 100 (what is above 100 defense) will deal damage, as well as 10% of 100 (what is below 100 defense). For a total of 50 damage
Thus by being a size 40 against 2 size 20, in this scenario, you dealt 2.5 more damage