It will work with VFR, but it's not as easy to fine tune the settings as using varied intensity is with the J-Tech grbl. Your feedrate settings for VFR Black & White engraving are way too slow thus burning very dark and actually cutting into the wood instead.
The Analog/PWM profile has more features/options.
No, not if you just want to engrave black & white images/logos with a dithered image using the Analog/PWM engraving profile. It will only have two S command values throughout the whole file. It's only when the S values are variable and constantly changing that causes dwelling.
We don't have a spindle on our Shapeoko 2, only a laser. The focal distance we found that works the best for image engraving is, 3.00" from the bottom of the laser's heat sink to the material. That is the distance we use when focusing the laser's beam on a piece of black anodized aluminum.
We made our own mount & heat sink for our Shapeoko 2. When we had the J-Tech 2.8W laser, we made our own mount. You can see it in this thread.
If you use the Analog/PWM profile, there is a 45D Left and a 45D Right engraving angle option. Only select one of them. You may find one works better then the other because the focal point is not quite round.
There are three places to input a feedrate when using the VFR Laser profile. Feed Rate is for the speed it travels with the laser at minimum/off power to the beginning of it starting to engrave and at the end when it's finished engraving back to X&Y zero place and the G28 position if that is selected. F60 must be the Feed Rate you set. The other two are the White Color FR & Black Color FR.
I assume you are using grbl 9i. Correct? There are some instances grbl 9i will freeze when using that version with a M30 command in the file. The VFR profile will add a M30 if the End W/G28 is not selected. I would recommend upgrading to version 9J grbl if you have not already. The Max S command value in 9J is S12000 if I am not mistaken.