you shouldn't really be able to touch the ground while on your saddle. you'll have to be on your pedals to get the height for the saddle.
sounds about right. I ride a 56ctc squared frame and i'm like 5'9" with a 30" inseam. it's a bit big for me but whatever.
2" on the standover means you can actually go a bit bigger maybe, but without pics that's a total guess.