I am trying to protect sleeping players on a PVE server from any damage - animals, NPCs (scarecrows, scientists, murderers, etc), explosions like Bradley, or whatever else can possibly hurt them as soon as they disconnect. Will this cover "ProtectedSleepers" everything or only from NPCs damage?

yes, use this flag
it will not protect against safe zone turrets. SafeZoneTurretsIgnorePlayers for that.

Naah, it's good.  Even on a pve I want to teach players to not sleep in the safezone because of the game 30min kill timer. That's fine, but for sure will do the protection agains animals, npcs, etc.