First, you forgot to escape the period in settings.php to settings\.php

> I'd like to edit the match to PASS that^ logged match -- as
> specifically/uniquely as possible -- but CONTINUE to 'deny all'
> for all other/remaining matches on "config".

Second, it's all in the location documentation:

http://nginx.org/en/docs/http/ngx_http_core_module.html#location

The two relevant bits are, depending on how you want to handle it:

1. If the longest matching prefix location has the “^~” modifier then
regular expressions are not checked.

2. Then regular expressions are checked, in the order of their
appearance in the configuration file. The search of regular
expressions terminates on the first match...
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