about Path Morphing:
to create smoother transitions from shape to shape, you could use Mask interpolation - it creates intermediate key-frames between two path key-frames. read about it here: Managing and animating shape paths and masks in After Effects . unfortunately, this is for Mask paths and not Shape paths. but you're smart - you know you can copy the path to a mask, do your thing, and then paste it back. or maybe you don't need the shape anyway. see if that works.
about Path Offset:
I was able to recreate the problem. here is how I see it: when you convert you Ai layers to Ae shapes, they get certain position attributes so that they will be placed in the same position. notice if you click UU you get the modified properties:
so when you paste the path from illustrator you are pasting on a layer that has an offset of transformations and that's why your layer is way up there.
this I don't get:
"To remedy the Vertices problem, I copied Path from Shape2 and pasted it into Illustrator, where I used the "Reverse Path Direction" tool under the Attributes Panel. (To do this, I pasted the path, then pressed Command-8, then switched the path direction.)"
you don't need to copy paste from Ae to Ai and back, when you can copy paste the original layer from Ai to Ae. this requires copy-pasting just once. you can copy paste paths from Ai to Ae and from Ps to Ae too.
these are my suggested workarounds (pick one! not all of them):
1. inverse the path in Ai - save the file, and convert the layer to shape again - this way you don't have to copy paste the path from Ai, but only from Ae.
2. reset the transformations and shape group position properties. then copy paste will be exactly where your path is.
3. if you don't really need shapes, you can work with layer masks instead and copy paste like crazy from Ai with no offset
AH, THANK YOU!
I know I had checked the Transform Properties of the Layer and Group for the first Shape, but had only checked the Layer Transform for the Path that I pasted it in from Illustrator (which set new properties).
As far as the path direction, yes one step too many. makes more sense to paste once from Illustrator. And even then, when I reverse the path direction from Illustrator before bringing it in to AE, that seems to fix the vertices problem as well.
Again, thank you so much. Multiple groups and layers to keep track of - overlooked it! Have a good one!
You're welcome! . Shapes are powerful but dealing with that many timeline parameters can be messy.