LaTeXStrings does not do any formatting. The only thing it does is allow you to easily construct strings containing LaTeX equations without have to do lots of escapes.
In short it’s not LS that limits what you see, it’s what interprets the LS (e.g. MathJax if you use something like Pluto). So to fix your issue, you have to figure out what is rendering the LS in your case and how/if you can pass additional settings to it.
Can anyone give me a hint on how Plots with the GR backend would interpret LaTeXStrings? (Sort of a as a direction before I go down into the rabbit hole)
I’d assume this gets either to the GR side or even to the display terminal (in gnuplot terms).
So would it differ if I view it in a GKS QtTerm or save the figure as PNG or PDF?
I don’t know enough of Plots/GR to answer satisfactorily.
One note that you could maybe use either the PGF backend or actually just use PGFPlotsX for full latex support (the latter also happens to be very fast btw).