I see that the pre-applied lithium grease is in the shape of a rectangle. The processor is also in that shape, however, when I see how the hoses are positioned out of the main base, the 'rectangles' do not match up. In fact they are perpendicular from each other. Shouldn't the pre-applied past cover the processor instead of overhanging the edges?

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If the AIO cooler won't mount to align the rectangles, then I'd clean the grease and apply my own bead in the center and mount it so grease don't run off the edge of the CPU.
It doesn't take much, about a bead the size of a match head to spread out and cover enough of the CPU for heat transfer.
To clean the grease, I use a paper towel to remove the bulk, then use Q-tips and rubbing alcohol OR Newegg has the cleaner & residue remover pack, as well as grease.

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