Well, yes, thanks. So it arguably should have worked in iTerm2 to start with.
In any case, now with the same configuration it'll even work on Linux (I also configured ctrl+left and right to work the same for non-⌥-having keyboards).
And my point remains the same, that I learned what was OSX, what was bash, and what was readline, more about how to configure readline, that you can 'cat' with no arguments and type things to see their escape codes (which is how I got ^[^[[C and ^[^[[D as the codes for ⌥← / ⌥→), that \e is short for the escape part ^[ (though I still don't understand how escape codes work everywhere, more learning to do). All because something didn't work how I wanted. Of course it'd be nice if readline had better defaults too :)