So then I should completely cover the top of the CPU?
Also, I understand that a "small amount" is enough but will there be issues if I put too much or too little on?
If you put too much on, it won't work as efficiently, and some of the excess will squish out the sides(which collects dust and hair), and turns into a mess in no time. Too little won't work as well either, but it really doesn't take that much. Just a fine layer to fill any microscopic grooves, and small concave/convex irregularities of the HS surface.