The fact about the bacteria is they will colonize any area of a tank with decent flow and not too much light. The best place for this should be in a filter. However, poor filter maint. will push bacteria to be elsewhere. When in the gravel they are in the surface layer, as notd, but mostly on the underside.
If nitrifyers die, they do not release anything into the water any different form other dead matter. Considering all the bacteria that normally lives in a tank, the nitrifying populations are relatively some of the smallest. So I highly doubt that killing off 100% would cause noticeable fouling issues. Of it would cause severe cycling issues.
As for a .25 ammonia reading, as long as the pH in your tank is under 8.0, ignore it unless it fails to disappear in a couple of days or if it rises. If it is not a false reading, the bacteria will catch up in a matter of hours. If it persists or rises then there are likely more critical problems than just losing a few substrate bacteria and these will need your attention.
The amount of toxic NH3 in .25 ppm of total ammonia in a tank with a pH of 8.0 and at a temp of 80F is .0155. This level is considered safe for salmonids which are known to be some of the most ammonia sensitive fw fish. The Merck Verterinary manual puts the redline for NH3 at .05 ppm.
Much as I hate to state this, most people in this hobby have 0 clue about ammonia, nitrite or nitrate toxicity and what makes them harmful or how to handle that.
Consdier this for one moment. You have a big pond full of fish. Lets say its 10,000 gallons and you detect a nitrite spike at 5 ppm. What do you do? Don't tell me repeated 5,000 gal water changes because this is plain silly. And what about aquaculture facilities? There is 0 way to do a water change on a pond that is measured in acres. How do these folks deal with a nitrite spike if they can not change water? Think chloride- do a bit of research on this and you will be surprised to discover that we can handle nitrite in our tanks using plain old table salt which is sodium chloride.