I have never tried pasteurization in the bottle, but I do think it is worth a try if you want to prevent dryness. I might have to give this a shot this year.
One thing I can tell you is not to boil the cider before bottling. I accidentally did this on my last batch and lost all my alcohol, plus the “cider” is cloudy and tastes cooked. Oops. I’ll never do that again. I wonder if pasteurization in the bottle will likewise cause cloudiness. It’s quite probable. But if you can live with a tasty but cloudy cider, then no worries.
I do agree that carbonation and backsweetening is a crapshoot. I kind of gave up on it the last couple of years. Inevitably, the cider is either bone dry and very highly carbonated, or the yeast is too dead to care and the cider stays sweet and uncarbonated. Carbonation is a skill I have not yet mastered. I have gotten lucky at times, but it’s not so easy to control. But perhaps this bottle pasteurization technique is the answer. So it’s worth a shot.
I certainly would not heat the cider beyond 170 F for more than about 10 minutes, to minimize the effects of cooking the cider and turning it cloudy. Ten minutes should be sufficient to kill most if not all the yeast to prevent a lot of refermentation in the bottles. In theory. More experiments are needed.
I have not tried lactose but it might work well. I have tried Splenda though and I HATED the result. Tasted like chemicals. If you drink a lot of diet drinks with Splenda, you might not notice. But I did. If you do try this, be very careful not to overdo the artificial sweeteners. Better to use less than you think you need than to use way too much and be sorry.
I have not tried the cider yeasts, however based on a Zymurgy article from 2013, it actually got the LOWEST scores of any of the yeasts tried. So, I wouldn’t recommend it. My go-to yeast for all ciders is Cote des Blancs. It’s fantastic.
No need to add sugar or spices to your fermentation. I recommend NOT doing that. You’ll get ~6% alcohol just from the plain juice itself. But of course it’s yours, you can do what you think you’ll like, if you want more alcohol then go for it. Personal preference I guess.