Does the touch hole need to be positioned exactly at the top of the pan for good ignition?
No. The idea that a touch hole must sit in a specific sunset position relative to the top of the pan is not supported by testing. Timed testing done by Larry Pletcher with a computer found little ignition difference across touch hole locations unless it was too high, with lower placement in the pan being only marginally better. Kibler's touch holes sit deeper in the pan and ignition performance is very good.