Question on fly sparging

I did an Austin Home Brewer Kit that said to sparg until the hot liqueur tun was empty or I reached a certain point in my brew kettle. I never reached that point in my brew kettle so when the 5 gal. of sparg water ran out I let it stop and all the water drain out of the bed into my pot. Did I do right? Should I have left the grain bed just a tad bit under water (Stopped when the 5 gal. was done)? The instructions were unclear.

You did fine, when I am finished, my HLT and my MLT are run dry.

Usually you want your pre-boil volume to be around 6.5 gallons or so. It's personal preference as to whether you want to boil for more than an hour or if you want to make a bit more final volume (say 5.25 or 5.5 gallons) to account for racking losses. As all equipment is different, find your boil off rate and adjust accordingly to what final volume you aim for.

Example, my equipment requires me to have a starting volume of 6.7 gallons to achieve 5.5 final volume in an hour. But, I don't mind spending a few more minutes brewing, so I don't have a set pre-boil volume that I aim for.

The only possible downside to any of this is over sparging and the subsequent tannin release.