If nothing else I'd use a different primary vessel to not have to account for the krausen and to leave less headspace in barrel. If your barrel is 55 gallons, and you get a couple of batches going in other containers, you can always add a couple of gallons of juice when you go to fill the barrel to make up any cider lost to the yeast. Or you could fill it with 40 gallons, ferment in the barrel, then add another 7.5 gallons, let it go, then top it off with more as it finishes up.
As far as how much volume 1lb of sugar adds, I'm not sure about that, but some quick research says that 1lb of sugar takes up about 2.25 cups. Not sure if that's dissolved or not, or if it really matters.
I've never let cider sit on a cake for longer than 2 months or so, so I can't really give 1st hand knowledge of off flavors. Like I said above, I'd be more worried about the headspace than the yeast cake. I know they usually leave Lambics on the cake for the entire aging process. If the "off" flavor came from the charred barrel, at least it's had a previous batch in there to strip some of that flavor...
Did your last batch pick up any un-wanted contamination (Lacto, Pedio, Brett, etc)? If the barrel has been stored correctly since the last batch, you're probably still okay if the last batch was relatively clean. I took a swab from the barrel I'm using and innoculated some beer with it to see if I had any acetobacter. Test came out clean.
What kind of yeast are you planning on using? I've used both champagne (ec1118) and ale yeast (s-04, us-05, wlp530, WLP300, etc). The champange yeast has much less krausen than the ale yeast. Champagne yeast also seems to strip a lot of the flavor and takes it down to 1.00 and below. The ale yeasts I've used seem to stop at around 1.000 - 1.002, leaving it slightly sweeter.
Next topic - yeast. The juice I usually use (Motts) is about 1.046 as it sits in the jug. Adding 2lbs of sugar to 5 gallons will up the gravity to about 1.064. Based on the calculations from Beersmith, you'll need 222.8 billion cells per 5 gallon batch. 2 packs of Lalvin EC-1118 would be good for 5 gallons, or 1 package and a .9L starter. The same applies to US-05 - 2 packs or a .9L starter per 5 gallons. Here's a link to an online yeast calculator if you haven't seen it before - http://www.mrmalty.com/calc/calc.html
For my 60 gallon barrel project I made a 5 gallon batch and pitched the package of Roselare yeast/bug blend. I let that sit for about a month, then racked to secondary and used the yeast cake as a big starter that went in to the 1st 20 gallon batch. I let that sit for a couple of weeks, then racked to another container and pitched the next 20 gallon batch on to that cake.
That's a lot to think about and get in to writing... and I was jumping around with each paragraph, so forgive me if I missed anything or something doesn't make sense!