Andy,
I saw the configuration but this is to block new user accounts creation and only allows users to login who already hold account in the system. It gives a error message "New account registration is not allowed." when any new user tries to signup.
I completely agree with you about blocking the registration using the "Who can register accounts?" => "Nobody, only login for existing accounts is possible" setting.
My requirement is to provide setting to decide whether to allow or deny new account creation when user tries to login to the application using his social network credentials (i.e FB, Google...). I tried logging into my application with my FB credentials, though i don't have account it simply created a new account from login screen and redirected me into the user profile page and this not i am expecting and it should show a error to the user like " You are not allowed to login in with provided credentials. Please register up to create new user account. " if we are not allowing user creation from login page.
Let me know if you still have queries or concerns.
Thanks,
Karthik