Ben,
The linker errors you are getting is because there is not enough space to fit your increased heap size into the memory map.
I don't think you can create a heap of size 40,960K. The Concerto board is very limited on memory (only 96K total RAM I believe).
Looking at the map file of your M1 project, the total size of S07SHRAM 64K. But, you have already used 56K which consists of your 20K heap and the remainder with is BIOS + NDK.
So, you would only be able to increase your heap by 8K.
Steve