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From the photo, I am unable to zoom in to see the spots, but I can see extreme "chlorosis" (yellowing), indicating a severe nutrient deficiency. This can contribute to susceptibility to leaf fungal disease, which may be what the leaf spots are.

The first consideration is watering. If you water adequately, not too much and not too little, the soil nutrients can be taken up and utilized by the plant.

This article gives some tips on fertilizing citrus:

https://www.gardeningknowhow.com/edible/fruits/citrus/fertilizing-citrus-trees-best-practices-for-citrus-fertilizing.htm

Here's an article on pesticides for citrus:
https://homeguides.sfgate.com/pesticide-fungicide-spray-citrus-trees-63024.html

Possums or rodent damage is possible, I don't know where you are located or what types of animal intruders you may have, but a local pest control service or university agricultural extension may help you to identify the pest and make recommendations for control measures.
As a California arborist I had never heard of Dynamic Lifter, so I searched and found an Australian fertilizer product by that name. But there was no information available on pest repellent properties. Maybe the dirty sock would be the primary repellent :) But seriously, there are effective rodent repellents available, and trapping is another alternative, as is a trunk wrap. https://www.bunnings.com.au/our-range/garden/gardening/household-pest-control/animal-rodent

Some interior and lower canopy leaf drop is normal as new growth appears. If you think it is excessive there may be a soil or water management issue.

If you think the light exposure is adequate and you have the water management right, not too much or too little, the next thing to consider is soil fertility.
How long has it been in the existing pot and potting soil? If a couple of years or more it may be time to re-pot with a good quality potting soil.
Do you fertilize? A good quality complete organic fertilizer can help supply plant nutrients to supplement what the soil provides.

https://www.gardeningknowhow.com/garden-how-to/soil-fertilizers/testing-moisture-in-plants.htm

https://www.planetnatural.com/potting-mix-recipes/

https://www.downtoearthfertilizer.com/products/blended_fertilizer/citrus-mix-6-3-3/

No, this happens when a segment below the graft point (which is a completely different citrus) is allowed to grow and overtake top graft branch. Those should be kept cut off to avoid taking nutrients and outcompeting the original grafted branch. Ultimately this can result in the death of the Kaffir top, leaving only the grafted root portion to continue growing.

This article will explain this process common to all citrus that are grafted: https://www.gardeningknowhow.com/edible/fruits/lemons/suckers-on-lemon-trees.htm

There are a few ways to do this. If you are just trying to grind them up really fine, then it will be much easier. If you are trying to extract into a concentrate, then this can take a little work. Especially if you intend to consume this.

As for powdering the leaves... You will want to wait until they dry, then send them through a coffee grinder, or good blender. You can always do it by hand, but this will take a while.