The dog is a girl, and she's about 55 lbs. She's actually pretty tall for a bully. In that little pic, she's about 10 months old, so she was more plump.
Both the touring and low seat help immensely with the sliding. That, along with the 14t front sprocket are the best things to spend money on - bang for the buck wise - IMO.
The low seat has real grippy fabric, and as you said, much flatter at the tank. The touring seat is flatter all the way from the back towards the tank, and feels wider.
The cushioning is much greater in the touring obviously, but the low isn't bad. Not sure how you'd like the touring seat at 5' 7", you would probably be fine, but it does raise the bike about 2 inches.
As for the rearsets, I agree, straight up rip off, with or without the passenger pegs. I never ride two up, and I got them before the price went up, so I saved about $300 over the M1100 specific ones.
Here is my bike with the touring seat on - I don't think it looks as good as the low, but thats subjective. Either would be a smart buy...