I have no problem with the house rules (so no screaming bloody murder here ).
As for the 'Canon' I'm not too picky and for me, the GM can change it anyway he wish and it's fine with me.
Alignment wise, We can use the Good-Neutral-Evil version of the Core 9 alignment, either way works for me.
I tend to use the -10/-CON rules for death in most of my AD&D games (as player or GM), so this way might be a bit easier...but I have no problem with a Grittier paly where we die at 0 or lower.
For a Squire are you talking simple fighter, or will you use the Cavalier rules for squire (with negative level)?
Roleplaying is not a Hobby...it's a Way of Life.