About the peaks you're seeing, I've found it is sometimes difficult to get measurements that are decoupled from the environment at this range. Could be peaking from the flare or from the motor chamber, but it also could be caused by reflections off nearby surfaces. Then there's also the measurement system itself, which could generate anomalies on its own. Hard to say without seeing a response curve that doesn't have these peaks - It's tough down below 500Hz or so.

But ignoring that for a moment, the performance in the top octave allows you some flexibility. That's good because it gives you more options. 1.6kHz is nice because it is a common frequency and there are many off-the-shelf components that use this frequency. Most compression horns work great in this range. And even the smallest horns are going to be free from reactive behavior by 1.6kHz, so you'll not have to worry about flare peaking from the tweeter horn. So you'll be able to look at each option on a case-by-case basis and choose whichever combination works best. Probably most will be fine with crossover anywhere in the 1.5kHz to 2.0kHz range, and maybe a little beyond.