Cracked grout at shower floor/wall intersections - how much do I remove?
Pretty 'rustic' finish between the wall and floor! General rule is to use silicone at every change of direction (wall to floor or wall to wall in a corner etc.) or change of material, (tile to wood or tile to glass etc.). As you said, aim for a clean square corner or 90 degrees between the floor and the wall. No need to go deeper than the surface of the tile. You'd have to go pretty hard (or be using powered tools) to hit the substrate under the tiles, so don't worry about that. Cleaning and sealing the grout (plus the tiles if they are porous) before the silicone sealant is best practice. Silicone is usually the last job (unless you're doing something silicone will not stick to).