I'm running X-Plane 11.30 with VKB Glad MkII. When I open Settings:Joystick, press the mode key to "green light", and then press any of the buttons, my Settings dialog shows that mode button is not functional. The same "red light" A1 to C3 assignments are activated.
The MODE button registers as button 29 and can be assigned a function, but there is nothing like a "shift button bank" function. There are a number of "toggle" functions that this might be useful to have an indicator light that shows the mode.
As for "how would a flight stick without 9 assignment functions be useful?", I have seven buttons un-assigned and don't feel the "loss of 9 functions" diminishes the usefulness of the best stick I have owned in forty years of flight sims.