I remember when Altec Lansing was a high quality American company. Now they are Taiwanese making little pc speakers?
Those dinky little 3" satellite speakers are probably made for 5W or 10W each, not 35W.
The little 6.5" woofer is not a sub-woofer and it might be built for 20W or 30W, not 35W.
The amplifiers in the TDA7265 "crystals" (bad translation) clip at 18W into 4 ohms or 8 ohms when the supply voltage is very high but here the supply voltage is probably fairly low. Maybe the TDA7294 is bridged with a low supply voltage for 25W or 35W to the woofer.
Overloading the amplifiers probably causes the supply voltage to drop which reduces the power in the speakers and might destroy the power supply.