My questions are as follows:
1) How would you guys go about teaching these pieces?
2) What is the best way to correct a students hand positioning?
3) When should I begin teaching a student how to read sheet music? (please note: both of the students use YouTube MIDI videos to learn pieces)
4) How should I go about choosing pieces for my students?
Anything helpful would be much appreciated.
Thanks for reading! 
1. There's a great deal to teaching these pieces - it's probably best to start with just addressing the concerns you are facing.
Satie LH - separate the bass and chords. When the hand knows how the bass notes relate to each other, as well as how the chords relate to each other, it is easier to move back and forth. Eight measures bass alone (repeat many times), eight measures chords alone, then do as written.
Debussy LH - block first to feel the different position changes. Then, even though the blocking may involve stretching, play as written and ensure the hand stays small, releasing the thumb and pinky when they are done with their notes.
2. Hand shape needs to be felt outside of repertoire first. Many teachers use either five-finger patterns or Hanon. Then, once the student has a reference from these simple patterns of what good hand shape is, it's much easier to transfer to pieces, though it will still take work.
3. Now. Teaching by ear is wonderful, but a little reading must happen in every lesson. Start with identifying all the C's, as they are symmetrical on the staff, then use them to help identify the notes in between. Note Rush is an excellent app to begin drilling notes. Once note recognition is good, move on to intervals, chords, scales. Reading doesn't stop with note-by-note.
4. This will be hard for a while until you get experience teaching more pieces. Every time you teach the same piece to a new student, it gets a bit easier. In addition to the RCM and ABRSM syllabi mentioned, Jane Magrath's The Pianist's Guide to Standard Teaching and Performing Literature is an excellent resource. Classics for the Developing Pianist by Ingrid Clarfield and Phyllis Lehrer is an excellent series of piano literature that you should know, and each level also has a study guide available with useful tips for teaching each piece in the repertoire book.
Knowing how to play the piano is not enough to teach. Teaching is a wholly different art. Many of us have master's degrees specifically in pedagogy. You should join your local chapter of MTNA and attend the state conferences. Find any other local organizations and go to their meetings. Pianoinspires.com, run by the Frances Clark Center, has video courses on elementary pedagogy you can take.