If I take Magic Priority A and get two magical skills at rating 5, does that put them outside the skill points I get for the priority I put in Skills? Or could I spend a couple of those skill points to raise the two of them from 5 to 6? It seems odd that Kyra or the Combat Mage archetype didn't do this.

You can, from everything I've read, increase those free skills as well as anything else. I've been playing it that way, anyhow. They aren't like special, can-never-touch-them skills.

Agreed, they are simply given up to that level for free, if you want higher you pay the cost for them to be raised.

I believe the only restriction applies to skill groups. They can't be broken up during the Skill portion of chargen, only during the spend final karma portion.