Correct this i can tell from experience as i went preferred lost my rested xp left for a month resubed and had quiet alot of rested xp on my character
I do know it maxes out at one full level though. So, lets say your level requires 500k to reach the next level, it stops at 500k rested xp. It doesn't matter whether you are 499K to go, or nearly there. But since only killing mobs reduces it (not quest turn ins, exploration or lore objects) that can easily stretch for several levels.