1.25 qts per lb is more than enough to completely submerge the grain. I've mashed a lot of higher gravity beers at 1 qt/lb, and even that covers all of the grain. What makes you think otherwise? To give you a frame of reference, many people here store their grains in 5 gal buckets, and it's well known that a 50# sack of grain just barely fits in 2 buckets. So if 25# fills a 5 gal bucket, 10# would fill 2 gal, which you're covering with over 3 gal of water.
How much water the grain absorbs during the mash will vary some depending on the crush, moisture content of the grain, etc, but will usually be close to 0.10-0.12 gal/lb. For your example this would equal a loss of about a gallon.
If you're going to batch sparge, you'd drain off the first runnings at the end of the mash, but before adding the sparge water. The easy way to calculate sparge volume for batch sparging is simply take the difference between your desired pre-boil volume and how much you collected from the first runnings. So in your example the first runnings would likely be just over 2 gal, and if your desired pre-boil volume is 6.5 gal, then you'd need just under 4.5 gal of sparge water. You can either add it all at once, stir, vorlauf, and then drain, or split it into 2 additions for a double batch sparge.
Until you've gone through the process a couple times you won't really know what the efficiency for your system is, so you probably won't hit your OG perfectly. Once you've brewed a couple AG batches, you should know your efficiency, and be able to adjust the grain bill to get really close to your numbers every time.
If you come in low, you can simply live with a lower gravity beer (maybe adjust the hopping a little), or boil for a while before starting the hop additions and have less beer at the correct gravity, or add a little DME/LME to hit the correct gravity. If you end up high, you can either live with a bigger beer, or water it down and have more beer at the correct gravity. For the first time doing AG, many people calculate the grain bill based on 65-70% efficiency.