You are getting pretty much under the ball as you need to. You are discovering that a little higher impact point is giving you consistent result of a double bounce.
At this stage of development that is important. At some point, you will need to be able to accelerate the bat much faster in a short distance. You are not getting much spin on the ball. You will need to be able to generate much more spin to get changes in variation to make your match serves effective.
It never comes together in one day, heck, it took me over a year practicing every day for my serves to be an asset.
JeffM,
Again, like I said, watch the Brett Clarke videos and take notes. He talks about the optimal motion for serving in this one below. This is how you accelerate the racket over a short distance and get massive amounts of spin. It makes it easier to disguise spin changes with subtle changes in contact point and racket angle. You have to shake into the ball, so to speak and ideally with a smaller motion, though you can use a larger motion as well as long as you stop contact at the ball - the larger motions are harder to control though. This should be your next step and is
the most important one and is related to the proper use of the "Wrist" in serving. Again practice this *away* from the table with floor and bed serves before you try to serve at the table. Too many people focus on generating spin at the table while serving and this limits their potential because they get so concerned with making the serve that they don't get really good spinny contact with a fast whip motion. IF you practice getting the spin first, then being at the table is more about control.
After you get better at this, the next step is spin variation - you want to be able to reduce the amount of spin on your serve by varying the contact point and swing speed with subtle changes. This is why it is recommended that you don't reveal too much of your swing or elbow while serving so people have less clues to tell how fast the racket is moving. By rule, they don't have to see the whole swing, they just have to see the ball and the contact. IF you can vary between no spin and light backspin and heavy backspin while making the swings and balls look fairly similar, you will put fair into the hearts of your opponents as they will be pushing no spin balls into the sky and backspin balls into the net. Even the ones that push your no spin balls low will still have to deal with your attack. You will also be able to transfer the spin variation to other serves.
When you have the variation, then being able to rotate into the ball to carry your momentum towards the table and facilitate recovery is the useful. But in my experience, it doesn't generate that much spin by itself. IT's really about being able to get the whip motion. If you use the rotation to enhance the whip motion, then the rotation is good. But if you just rotate without the whip motion, then you end up not transferring much into the ball. Rotating tends to help recovery so it is good in that regard.