I think that allows you to make separate settings for kingdoms you yourself hold. For example I acquired Saxony with messed-up ducal borders as Germania but allowing internal vassal wars meant the problem corrected itself over time (the dukes took back counties that de jure belonged to them, and then the King of Germany took a couple counties that should have been his from the Duke of Holstein). The empire's law is applied where you
don't hold the kingdom.
I think you mean, your duke vassal conquered a county, in which case, yes, the county becomes part of his lands (though it won't ever become
de jure part of his duchy since only duchies and kingdoms can be assimilated into different higher titles than they started). And since they're his lands, they're also
your lands as his liege.
As for your second question, if you're asking if you can clean up your internal borders so that your various vassals only hold the titles that should be theirs
de jure, yes. Mainly what you need is to pass title revocation law, which allows you to seize titles from vassals. Normally this incurs tyranny opinion penalties with other vassals, but:
- If you have a claim on a vassal's title you can revoke it without tyranny.
- If they rebel and you defeat them, you have cause to revoke one title without tyranny.
- If you pass Religious Revocation law, you can revoke any title held by an infidel or heretic and will incur tyranny only with vassals who share that religion.
- There is also a plot on the Intrigue menu that allows you to conspire with other vassals and demand that a vassal give up a title under certain conditions. The title must either be non-de jure (say, a Duke of Scania who also holds Fyn in the Duchy of Sjaelland), or be in a duchy that you yourself hold. You get to 80% plot power and then issue an ultimatum, and this will usually trigger a rebellion that you can use as an excuse to revoke a second title.