1. Is there a good rule of thumb to determine when seedlings should be
repotted?

Seedlings should be transplanted when they have their second set of real
leaves.

2. I picked up some Munstead Lavender seed to grow as an annual. The
seed packet said to start indoors anytime during the winter, so I
started it right away. I'm still about 12 weeks to last frost - is
the lavender going to have a hard time being transplanted after
becoming accustomed to the comfortable indoor conditions? If space is
really the only issue, I can make room for them and still provide
ample light.

It's not clear when you started them but these seeds are slow to germinate
so you should be ok as long as you give them lots of light (so that they
don't get spindly) and harden them off properly in a cold frame of some
sort.

--
Shadow
Made In Canada, eh