I'm not sure about the FS because we don't have that in PA, however, on the issue of the taxes and encumbering the second lot, I can comment.
Lenders do not pay taxes on land that they have not mortgaged and so the current lender cannot be faulted for not not paying them for you.
There may have been some reason why the lender did not want the second lot in their mortgage. We don't know, but the real problem in all of this is just basic communication and taking the time to read documents you sign.
Presuming there were no written [pre-closing] disclosures that described the land or the tax figures, there were at least two documents presented at closing that, if read, would have alerted you. The mortgage document contained a description of the land. The initial escrow statement gave you tax figures.
In a refinance transaction, the title company is insuring the lender and they are taking their instructions from the lender. There is a presumption that you and the lender are on the same page. A good title agent will keep their eyes and ears open for possible misunderstandings and help the lender and consumer resolve potential errors, however, this is a courtesy and good service and not part of the insurance. I don't see a title insurance claim here.
If you've not read the book or seen the movie, I recommend looking for The House of Sand and Fog. It's about a title insurance claim and based on a true story in which the homeowner neglected to read her mail.
Humans can have misunderstandings and consumers have an obligation to read over documents or risk being legally bound in an unexpected circumstance. This seems to be a hard lesson learned. I wish you well.