1) The car has a number of layers of paint (including white), I know from reading a number of posts that the primer should be red oxide but it appears mine may be grey. The car engine bay may have been stripped before and that is where the grey came from.
First off red oxide was not used on all the cars, it's just the most popular. It all depends on the plant and time it was assembled. My dearborn car had the original black engine bay and the color under that was a metallic blue/grey color that was found hit and miss on the entire floor and inner and outer aprons. I would check the color of the floor pans and if it's the same as your engine bay it's most likely original.
2) When I apply the new red oxide, is it from the firewall forward including under the frame rails or are the bottom of the frame rails slop grey?
My October built dearborn 69 had the mentioned blueish grey metallic and the engine black out was applied very sloppy (probably one wet coat) and the coverage ranged from runs to no coverage at all in the hard to get to crevices and that showed the blue color and bare metal. the front of the radiator support was blacked out along with the inner aprons and the black faded into the tunnel and lower frame rails.
Suggestions for brand and type of black? (Mustang Magazine listed Dupli-Color Engine black as their recommendation in their most recent magazine)
I would avoid aerosol spray can paint as much as possible in the engine bay as it is not near a durable as a two part catalyzed paint. I like STANDOX ralley black, its easy to use and extremely durable and looks correct. There are several other brands as well.
I will upload a couple photos of mine, however going back with my car I chose to do a little nicer job.