I've probably wandered a bit off topic with this, but I'd agree
Sweet's Anglo-Saxon Primer is a better place to begin learning Old
English than Campbell's complex historical grammar. The section you
quoted didn't display the special characters on the Yahoo groups
website, but as far as I can tell it's the same as my copy (the 9th
edition, revised by Norman Davis). This book prints the dots
consistently, I think, but the rules for when they will appear are
incomplete and thus sometimes inaccurate, e.g. 'þancian' correctly
appears with no dot in the glossary, but the rules given imply that
it ought to. Also, it's not made clear to the reader that the rule
which mentions the letter <y> only works for normalised spelling.
There must be a happy mean, a definitive way of introducing this
subject! For me that would probably have a bit more detail than
Revised Sweet, and certainly more than Mitchell and
Robinson's "Guide to Old English". It would have some explanation
of prehistoric sound changes with examples of common classes of
words where these create apparent exceptions to the rules, e.g.
class 1 and 2 weak verbs. It would take into account Campbell's
information (and that of other detailed treatments), but present
this in a digestible format, relegating justifications, evidence and
alternative views to footnotes. It would make clear where it was
refering to the palatal stop [c] that arose early in the history of
Old English, and where to the affricate [tS] this developed into,
and smugly point out that this is the source of apparent
contradictions between other text books (Sweet, on the one hand, and
Baker, plus Mitchell & Robinson on the other). It would probably
have less wanton digressions than I'm wont to make...