english saddle fitting question

When you are sitting in the saddle (on the horse) should you still be able to run your hands down the front of the panel?

Maybe I am being paranoid, but if kind of looked like the points of the tree might be digging in a bit on my horse the last time I rode.

No always. Don't forget that unless you're very careful about how you do it, the act of leaning forward slightly to push your hand in, automatically puts more pressure on the front of the saddle, giving the impression that the saddle is too tight in front.

If you're concerned, focus on your horse's movement. If s/he feels as though s/he's not moving freely from the shoulder, this could be caused by the saddle being too tight in front.

Also. When you're finished riding, check to see if the sweat mark is completely even. There shouldn't be any rubmarks or dry patches. You can also press your fingers into the areas around the whither and behind the shoulder (about as hard as you would if you were giving someone a massage - careful, but firm), the horse shouldn't flinch drastically or dip away from the pressure.

He is moving the same as always, and isn't resistant to being caught, saddle, mounted, etc.

However he did react when I started pressing around in the wither area. I think adding extra padding would only make it tighter right? It fits him great as far as not being too low on the withers, and through the rest of the shoulders, it just the two tree points.

It also doesn't help that he has a rather squishy topline right now too.

The only type of extra padding I would consider would be a sheepskin pad. It needs to be genuine sheepskin though and not the nylon immitation.
This should help to lift the saddle away off his shoulders.
The other thing you could do is if the saddle is adjustable, try getting it made a size wider, that should also help to alleviate the pressure of the treepoints on his shoulder.