With us, when the baby was tiny we would leave a generous gap between dh and my pillows and the baby slept in the gap (in an ordinary 4'6" double). He or she wore vest and babygro. This would have been in autumn/winter. I, too, am a heavy sleeper, but when you breastfeed and co-sleep you become very tuned-in to your baby's needs. I always woke before the baby actually cried - just the grunting and rooting would wake me enough to know whether I needed to feed or comfort etc.
With our first child dh was very aware of the baby's presence in our bed, and would sleep mirroring my posture: curved around the baby, with one arm 'tenting' over the baby. With nos 2 and 3 he was less aware, and often turned his back on the baby. But, as I was so atuned to the baby it didn't worry me. Whenever I left the bed at night I would nudge dh and remind him that the baby was behind him in the bed. Generally I would return from the toilet to find dh had turned and curled around the baby, or taken the baby onto his chest.
At about the age of your LO, we would generally end up with the baby sleeping betwen us, and the pillows in the normal position. I would make sure hat dh wore pjs, so that he would be too warm to pull the duvet up to his chin. The duvet would generally tent itself over the baby without touching him or her. AGain, because you are so atuned to your baby, you check them without even thinking, and wake if there is any reason for concern.
A co-sleeping baby does not need to be in a sleeping bag.
If you can't put the bed against the wall, I would say that the baby ought to sleep between you. Could you make a 'bed-guard' by pushing the cot against the bed?
As for feeding, practice feeding topless lying down during the day to get the hang of it. Babies need less help latching on while lying down, IME, than they may do when you feed sitting up. Gravity? I don't know.
If you feel the baby's face is being squashed by your boob, bring the baby even further down the bed, so that they have to turn their face up to the boob. You can always draw them back up the bed after the feed.
From my expereince of a co-sleeping baby who turned into a boob-a-holic and wanted to sleep with the boob in his mouth (only 1 out of my 3, thank goodness!), I would say to slide yourself away from the baby after you've fed, but it's not critical. I found it very good to turn my back on the baby and snug up to him that way. I was still completely in touch with him, and could feel his breathing.