The open circle appears wherever there is a track joint (or end). I tested on your xtc and that is accurately showing those points where a click will allow an elevations to be set. All the signalled points at 10'x4' are track joints. You have, in at least one case, remarkably small track pieces, all of which will have the open ball at both their ends. You'll see this when zoomed in. This maybe how you arrived at over 10,000 track pieces - one of the highest totals I have seen. If I might be so bold, your plan could benefit from some use of Cornus to replace these sections and so drop the track count which would speed up loading.
Note that the track being followed by the blue ball can flip as tracks are near each other if the other track is higher in "draw order". The assumption by the tool is that higher tracks will be "Above" lower tracks and so preferred. But there is no actual enforcement of order in XTrackCAD and new tracks are always "Above" older tracks until the Above/Below is used. As the ball flips tracks, that may give rise to a suspicion that it is "jumping" - it literally is - to the other track. This draw order also determines which track is listed first when a square appears.
The square will find any crossing track. It was designed to find all such tracks so that all clearances would be shown. The fact that a track is hidden is not of concern to it as it currently exists - since seeing clearances to a hidden yard is exactly what may be required. It could be possible to add a maximum clearance but we don't actually have vertical clearances per scale/gauge in our settings currently - it's an idea I have thought about as side clearances might also be useful in some cases.