The Steele Dossier was mostly compiled by Glenn Simpson back when he worked for the Wall St Journal. Then it was just rumors about a colorful billionaire and didn’t have political implications.
Steele was just a cover story to lend credibility.
No. They needed the imprimatur of the Russian “contacts” that Steele could add as part of their “evidence”. The Russian community in the U.K. was happy to provide them. Without them they had nothing “official” behind them; no provenance worth considering. Steele and his reputation and his Russian contacts made it all appear “legit”. Steele was needed. They never would have gotten Simpsons tales alone as far as they got the “Steele Dossier”.