Hello all, thank you to everyone who helped me with this.
I just wanted to follow up to say that I was able to get the remote start and key bypass programmed and working, once I figured out the kinks it works great.
Now about those kinks, first off I just want to say I am still not 100% sure what was going on with the DCrypter, however I was able to get it first try with my secondary key fob following these steps:
hard rest the unit with the red light / data-link method
from the "PRO" setting screen I manually set the options I need (A1-11 ON, H2 ON, etc) and the saved them to the unit
I then began the programming procedure starting with hooking up the R-Link and making sure to close/open the door before beginning, then using felt tape to secure the fob to the transponder
after completing the inital programming was complete I was then able to run the DCcrypter software to program the new key bypass to the unit and install.
after testing and verifying that eveything functions as it should I then programmed my RF-Kit fobs.
Somethings I will note for any future struggling persons, the instructions for wiring the TB-VW aren't very clear in the guide I used about needing to cut the transponder brown wire in two then wired to both the green and the green/black to their respective sides, it at first appears that the other side isn't used.
Save yourself the headache and solder all your connections, I tried to vampire taps the first go around and ended up re-doing all of them.
Also, about the two lights that started this all. I saw a list of five or so vw firmware specific error codes that someone had posted deep in the Q&A section and indeed cabus errors was code number 2 x2 red flash. I will post it here if I can find it but it would have been nice to know without having to hunt outside of the guide.