Great post, thanks for writing it! I've seen my share of horrifying DMPC's, and I think something like this should be required reading. It can be a neat tool for a DM but it can also go so terribly, terribly wrong.

I would actually add to your list the following possible pitfall:

4) Becoming an overbearing plot presence. You've already discussed the temptation of DM narcissism, in that your NPC could dwarf the PC's mechanically with levels and items. But just as problematic is when their importance in the story overshadows that of the players.

I've seen campaigns where the DMPC was actually the hero, and the players ended up a band of cheerleaders; where the players might have solid backstories and a few prior adventures, the DMPC's would be centuries-old demigods with immeasurable power locked in a constant struggle for balance in the universe, etc etc. All of the plot hooks come back to the DMPC's goals, all of the antagonists just so happen to be aligned against them, and whatever your players need to accomplish just so happens to be what the DMPC is doing.

I would argue that this is very different than just making the character have bigger numbers than the PC's, and is potentially even more threatening to them, because you can essentially hold them hostage by refusing to let go of the reigns, and following them around with this plot-important black hole that absorbs all of their success. I also feel like this is distinct from railroading, because it can occur even if your players somehow manage to jump off the rails for a bit. The simple guideline to prevent it would be;

Nobody that you create is more important than your players. Full stop.