I don't see why Commercial Code section 3311 doesn't apply to your payment plan, and apparently they haven't given you a reason or authority that says so either. I'd keep paying as agreed and put the restrictive endorsement on each payment check. If you're current in 3 weeks that's too quick for them to win a lawuit, although they can presumably bring one, but I think you'd have a defense to any claim of breach since they are accepting your checks.
I think I've answered at least 5 of your questions, please click on the "helpful" thumbs up icons for these questions (and any others you find helpful) so I get some points for this.
Disclaimer: Please note that this answer does not constitute legal advice, and should not be relied on, since each state has different laws, each situation is fact specific, and it is impossible to evaluate a legal problem without a comprehensive consultation and review of all the facts and documents at issue. This answer does not create an attorney-client relationship.