Can't help you much on the Cockatiels, I think if he grows up with them and he's introduced slowly to them and he feels they're just part of the pack he moved in to, things should be fine..mine seem to be a bit more low key then my yorkies.
At this age, I don't think the ears will go up anymore on their own, but they're cute either way.. Sandy is a very experienced breeder, go with whatever she says...she's been doing this a loooong time. Say "hi" to her for me..
-Diana
