Fret crowning question

You're doing the right things. I typically do the black marker trick before the leveling, because that's where you really want to be able to see where you are contacting the frets. My favorite marker for darkening the fret tops is a Sharpie Industrial, the big fat ones that they sell at Home Depot. They have a wide chisel tip that works great on a fret.

For the crowning, you want to leave a thin line right down the center of the fret. I don't know if the width of the line matters much, just make it thin and uniform, and centered. If you crown it too much and "erase" the line, then you've damaged the leveling. So, to do a perfect job, make the line as thin as you dare without erasing it.

If you file too much on one side, causing the line to be off center then, yes, you've moved the point where the string is contacting, messing with the intonation. Sometimes we intentionally crown frets offset to correct the intonation on an out-of-position fret. That sometimes is a problem on '60's instruments. On most modern instruments, you can assume that the slots are accurately located, so the thin line should be centered on the fret, and centered over the slot.

I don't know if there's any solid answer to when frets are too low. Super low cut frets were a fad a while back, mostly on guitars. I guess they are too low when you can't make a crown on them any more. Or when the edges cut your fingers.