I think the version I use is a standard conversion of the DAOFIND routine to Python. I use it to provide the positions of the stars and then do photometry on them.
After that I compare my coordinates with those of stars in Gaia DR2 and generate the matches. So I then have measured flux versus catalogue mag.
I then fit a linear regression and recursively remove the outliers. I’m fairly sure I found that more successful than using weightings. I had expected extreme colour index stars to cause problems too but that had a relatively minor impact.
I think in my process any star with a peak brightness >50,000 was excluded from the linear regression. As you say setting a magnitude limit should work but the count was easy.