I have seen him turn people down to race if they are too slow. I'm sure there is some wiggle room but I watched him turn one away for running off pace. He didn't want the racers to deal with the safety issue.
Drop one down in the front and two up in the rear. They usually don't recommend going more than 1 in the front. If you do front and rear the chain you have should still fit if your not replacing it. 1 front tooth is about the same as 2-3 on the rear.
Glad you have a hard on for Wal-Mart. I know quite a few people that work there and that video is very accurate. This is why I don't shop there, lowes or any other store they own.
I refuse to shop there which sucks being in a small town with few other places to go. They really aren't that much cheaper than anywhere else but it's a pain when they are about the only place that sells kids toys.
Someone with a SV manual should have the specs but that takes up the slack between the swingarm and frame. It keeps the swingarm tignt on the chain side of the frame. I don't see where they call out a spacer so threads would show.