What are the steps to drain and refill zone for zone valve replacement?
I turned off both valves 1 &amp; 2 figuring it isolated most things and valve 2 didn't seem to close all the way.
The steps I used to drain were:

turn supply off
turn return off
open hose bibb
open bleeder valve on register farthest away.  If you don't do this, it seems to drain very slowly.

When refilling/purging, it seemed to go better/faster if that bleeder screw opened in step 4 was left open until things are flowing well.  However, if you do that, by the time you get back upstairs to close it, there will be water on the floor.  If you want to avoid that, you'll either need two people, or you have to close it before turning on the water supply, go upstairs and then open it up to help bleed the system.
In step 3 of the original post for purging, I do now believe that opening the pressure reducer valve (bypass) is done to overcome the air pressure in the system.  If you don't see water coming out after say 30 seconds, do this as a short burst and it'll get water moving.  I never did come up with an answer about the pressure getting too high.  When I opened it up for a short burst, I didn't notice the pressure go up--probably because I only opened it up a bit and for a quick time.