Don't worry about the bottom leaves, they all do that and die off quite early, no matter what happens and are safe to remove.
The tiny branches at that node never really develop that well either and are best removed too.
I would suggest that next time you fill your pots/bags right up, this way the seedling sits up a lot higher and gets a lot more light, meaning it grows faster.
Also, the more soil there is, the more room there is for roots which translates to bigger plants too.
Hope this helps, Organoman.