Shouldn't it be the other way around? IIRC, the tolerance means how far below your set temp it has to drop before it turns the heat on (or vice versa). So if you set your stc to 18, with a 1 degree tolerance, and it gets to 19 degrees, it'll turn your freezer on (after the 10 min delay you've built in). As soon as it hits 18, it turns it off, and won't turn the heat on unless your temp continues to drop and reaches 17. So putting it to a 0.3 degree tolerance will actually turn the heat on when it drops to 17.7....i.e. more often.
I agree with everyone saying your freezer is so cold it's continuing to drop the temp of your wort for a long time after it reaches the desired temp. But maybe you need to increase the tolerance temp to say 2 degrees, and decrease your compressor delay (maybe 2 mins?). The only problem with that is it won't start cooling until your 2 litres of water reaches 2 degrees over your desired temp...but that may not be too bad, given the temp of 2 litres will raise much more quickly than 20 litres + of wort.
It's early and i'm a bit foggy from a head cold but I think that's right?