Hi Juz,

I am really sorry for the delay of this reply. Please find my answers from your inquiries below.

Who can view my photos? Who can view my albums? We’ve set both these setting to “Only Me”. Subsequently, when a user shared a photo album in the group, none of the other group members could view the album in the group. Does this setting override default group behavior?

I've tested this behavior in easysocial 1.4 with user's privacy settings is set to "only me" and then try to add photos or albums on both dashboard and groups. Below is the result of the test case above:
1) Post a photo in dashboard stream and no one are able to view the photos except the user itself.
2) Post a photo in group stream and everyone inside the group are able to view the photo.
3) Created an albums in user's profile and other users are not able to view the albums except the user itself.
4) Created an albums inside the group and everyone inside the group are able to view the albums.

what about "Who can view my stories?" If we change this setting to "Only Me", does that apply only to the main dashboard or also in groups?

It has the same behavior as my test result above. This privacy is only applied in dashboard section and it will not affecting stream posting in groups.