Refinancing: Do I take the lower rate or the better LTV ratio?

Since they already own my escrow, there is also no additional funding needed there.

Are you sure ? I did a 0/0 refinance with the same company and it didn't help at all. They fully closed the existing mortgage and escrow account and set up new ones for the refinanced loan. In fact, they were trying to screw me out of $2000 on the Escrow refund and I had to threaten legal action before they finally admitted their mistake (or fraud attempt). In my case refinancing with the same company actually made it harder since they mingled the papwerwork which made it hard to really track down the root cause of the discrepancy.

This being said, Escrow should make no difference here. It's your money not theirs. If you need to pre-fund your new escrow with $8000, chances are that your Escrow refund from the old mortgage will be roughly the same amount. Even if they roll the initial Escrow into the new mortgage balance, you can use the Escrow refund to immidiately payoff $8000 of the new mortgage.

That leavs the points decision. This depends really on how long you plan on keeping it. Inetrest rates are very low at the moment, so chances for a nother refinance are small so it's more about moving or upgrading. Break even point for yoou numbers is about 6 years. If there is good chance, you'll stay for 6 years or more, pay the points. Good tool: https://www.nerdwallet.com/article/mortgages/should-i-buy-points-mortgage-calculator

The LTV will indeed be higher for the points version but only by the points amount. This will diminish over time, i.e. after 6 years the LTV will be the same and then it will be better. If there is a specific threshold of LTV that's important to you (mortgage insurance, credit rating, etc) that you can pop the numbers into a spread sheet and check out how long it would take to reach your "target" LTV for either version.