If you park your bike unused for weeks, then yes disco the battery. Just measure what the current draw is, at idle and while off but connected.
There is a spark each time and those get bigger with increased voltage. The contacts don't weld each time. Instead they get damaged and blackened and pitted with each arc. Eventually they will either weld together in the on position or fail to make a good contact at all.
Yes, you're talking about a precharge resistor circuit. That gets turned on first, slowly charging the capacitors, and then the main switch. All the big controller companies for everything but ebikes have precharge resistor circuits it in their wiring diagrams. At lower typical ebike voltages, 24V-36V, the spark is not as significant.
I don't have a precharge resistor circuit on mine, because I so rarely disconnect the battery from the controller. If I do disconnect, then when I reconnect, I use a fat resistor to make the connection first and charge the caps, and then make my connection. Even that would be difficult the way yours is wired, because making the connection also turns the controller on, so that power drain would draw down the capacitors charge fairly quickly. You'd have to charge and then quickly make the connection. Your controller has a wire specifically for a switch, use it.
Yes, google precharge resistors, and capacitors current inrush. Dr.Bass actually blew something else on a controller that he believed was directly caused when he forgot to use his precharge. Wear on caps is definitely real, but not something easily quantifiable. Wear on switches is real and visible.
I wouldn't even mention it regarding such a beautifully built bike if the issues weren't real, because the last thing I want to do is be critical of hard work, especially hard work that turn out good enough to be an example for us all. A number of people have used those same switches, and typically they are in appropriate. The key itself is kinda cool, big and prominent on the side of the bike. Use it on the controller wire meant for the on/off switch, the smaller positive wire on the controller, and put your bluetooth thing on that switched circuit too. Then you just need to disco the battery when your bike is unused for long periods.
One last thing that I think you asked about, as I understand, turning that switch off under load (like a runaway bike condition) could result in a failure of the switch welding it in the ON position. That kind of failure would be pretty rare I'm sure, but just last week our microwave's power cord somehow welded itself in the electrical socket, something I've never seen before. Almost every time I'm welding, I get the electrode stuck to the metal at least once while trying to strike an arc, and the amps for welding aren't a lot higher that some of us use on our bikes.
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John
