How come my cupcakes didn't rise to the top of cupcake liner?

You could have under- or over- mixed the batter. I don't know if baking flour refers to cake flour or pastry flour, but both have different gluten and protein ratios than all-purpose flour. As for the icing, just add more confectioner's sugar. If you didn't thaw the berries before pureeing them, they will release more water as they thaw.