And to answer your questions -- runaway could still happen with the baffle on there but it's less likely. And yes, I believe it could just be caused by an overfull sump.
Second, regarding how far you have to tear into the engine if you decide you have ring problems, it's always unfortunately a decision you kind of have to make after you've seen what things look like on the inside... if the engine has under 200k and the compression isn't shot, chances are good you'll be fine just honing and re-ringing. You can do all that easily with the block in the car, just pulling the head and the pan. I did it in an easy weekend (having collected all the parts and tools beforehand though), at a total cost of about $100. Since then I've driven that engine cross-country twice (Seattle to Colorado to Boston, then back from Boston to Colorado to Los Angeles to Seattle), and lots of other driving besides, 25,000 miles in all, without a bit of trouble ever. Still no oil use and full compression. I don't expect it to last 200k, but I don't need or want it to. 245k on the original block, pistons, etc, only new things are rings, valves, and valve guides/seals. And honed it.
However, I got lucky with an engine that was basically in OK shape other than having shot rings. If you get in there to re-ring it and discover your cylinders have deep scoring, there's a big cylinder wall wear ridge at the top, your pistons are beat, or something, you'll have to pull the block and have it bored, do oversize rings and new pistons, the whole deal. But if the pistons don't have too much play in the ring lands, you clean them well, get a good hone on the cylinders and there's no scoring and the ridge isn't too huge (big ridge means big taper wear in the bores, and could break off your new rings), go for it. A re-ring is never a real rebuild but if you just want to drive it for a while and not spend much time or $$ then it will often do the job.