It will not descend to the RTH altitude if you are above it at the time. It will maintain current altitude if above the RTH altitude. If below the RTH altitude, it will climb to that altitude first.
YOU MUST SET YOUR RTH ALTITUDE TO BE HIGHER THAN THE HIGHEST OBSTACLE IN YOUR AREA OF FLIGHT. Otherwise, you run the risk of it flying into a building or tree or whatever happens to be in the way when it tries to RTH.
Rewind is not part of any failsafe. It will not rewind when you lose signal. That was the original intent, but the idea was scrapped in beta. Rewind only happens manually by long pressing the pause button. No other circumstances initiate rewind.