Well if you’re getting too much lift, the kart will either overload the outside rear and you’ll start sliding as the tire loses traction. Typically you’ll feel it lift on turn-in, and as it reaches it’s height, you’ll start to feel the rear slide and you’ll start to counter-steer, setting the inside rear down and making the kart flat-slide.
Too much lift can also cause the rear to break traction on the outside rear and cause the kart to hop a bit too as the rear grips and releases and repeats.
I can’t tell you specifically when you’d make a seat change like that since I also only use one seat in one stiffness all the time and I’m small so I always need to find lift.
My guess would be that the soft seat works better for tall guys when the grip comes down and they need the softer seat to absorb some of the weight transfer. But I’m not positive.