I think the dealer's goal was to set it up so you get far enough away that you don't come back....
Forget the measurements, this is just gibberish if you don't understand it, I dont think you do.
The trailer should ride level, the truck should ride close to level, though if the rear sags an inch or two this is normal. Trucks are usually rear-high in anticipation of some turckload to weigh it down and bring it into level.
Absolutely the WD hitch when engaged should raise everything back up, this is the whole point of "distributing" the "weight".
I think on the Anderson you use the tongue jack to unweight the hitch, make your adjustments, and then lower the jack. On other brands the WD can be engaged with levers and you physically can see the tongue lift up when the WD springs are engaged. With Anderson you can just measure the difference from un-engaged to engaged. If it does not do anything, then adjust it to have more tension. It should lift the rear of the truck back to where it was before the trailer was dropped on it (or really just under that point, an inch lower is fine).
The hitch height adjustment is so you can move the ball un or down so the trailer will ride level after you get everything set up. As opposed to a bumper mount ball where you have no adjustment and it rides where it rides, the adj hitch lets you set it up, there is no pre-set height, you have to figure that out, some trial-n-error needed too.