Hey Paul:
Your presumptions are not entirely accurate and that my friend is what's throwing you off in your understanding. Good on you for noticing this AND asking about it too.
When you talk about what "we" do please be advised that we.... do not all do fret work the very same way. Nor do we all want a fixed radius on either our boards or our fret tops. A compound radius is desirable because it actually permits ever so slightly lower action and to many players, not all.... that's a desirable thing.
The method that you are using, sanding the board to a fixed radius need not be done that way. You can use tube stock precision ground very flat to sand the board to a compound radius and then after installing the frets the very same technique can be used for level the fret tops.
When we fret as I have described, and we do this every couple of days with our very busy multi-Luthier repair business we find that the amount of material that has to be removed from the fret tops is mouse nuts.... nearly nothing at all.
Moving on the line that you see on your fret tops or what we call the "crown" should be fairly consistent, thin, unbroken, and without wide flats as we see in your picture. We like the fret crown to look like new fret wire prior to being installed and the methods for crowning, tools that could be used, etc. vary some too. From old school three corner files to newer diamond files great results can be achieved with a number of methods and tools. Most of all though I want to toss the severed head out there in folk's laps (Apocalypse Now fan, forgive me please..) that the better job we do on leveling the board and installing the frets with uniformity the less if any material we have to remove from the fret tops making the discussion of the "line" or marker line less important.
Anyway fretting is a art. Most f*ctory instruments are distributed with "fair" fret work with a few exceptions that can be better or worse than the norm. Many Luthier built instruments can have anything from horrible.... fret work with loose frets, nothing close to a level set, and fret ends that might be better employed in that film 50 shades of grey..... Other Luthier built instruments can have fret work superior to the usual suspect f*ctory producers. Just depends on how much the individual builder cares about the fact that ultimately a guitar is a tool for a musician............
For acoustic instruments specifically for blue grass music where hit em hard and set em high is the norm for playing and set-up... the quality of the fret plane is not as important because of the higher action. Some of the worst fret work we've seen has been on these instruments. The best fret work that we see is typically on shredder guitars where super low action is both desirable and necessary for the playing technique. Low action is intolerant of lousy fret work.
Fretting is an art as mentioned, we teach it and many OLFers have been to our shop to learn and you are welcome too. 2017 classes will be scheduled and posted in a month or two when we can see 2017 better from here. It's a two day class and we teach our students how to do superb fret work including for repair work, refrets, etc. as well as on new builds and we teach how to do superb set-ups too. Nut making, saddle compensation and much more.
In our classes all of your questions would have been addressed in the normal material and then we dive deeper until you leave finding your self not only understanding how a guitar needs to work but perhaps even at times imagining that you are a guitar...
That's my story and I'm sticking to it.
If interested shoot me a PM.
Great questions and observations on your part too.