Downlinks, I assume. The uplinks should work regardless any setting of LMIC_setClockError.
Well, assuming that value is correct, and assuming an extremely accurate clock: yes.
I doubt the gateway will have timing issues. Maybe it would suffer the ERROR: Packet REJECTED, unsupported RF power for TX - 24 but that would not be fixed using LMIC_setClockError, so unlikely that’s also your problem. Or maybe network latency makes the downlink arrive at the gateway too late. Make sure the gateway’s router and application’s handler use the same region.
(Aside: “TTN-GW-868” is too vague. TTN Kickstarter “The Things Gateway”, “The Things Indoor Gateway” or “The Things Outdoor Gateway”? And if it’s the outdoor one: ethernet or 3G/4G?)
I’m afraid there is not much else to investigate. You’ll need an extra gateway or an extra device for more testing. Or peek into the gateway’s log. (See the FAQs in the documentation.)