Good morning. As you know, In general, butter in a cookie recipe tends to make a cookie spread. Butter has approx 17% water in it. Also take notice that the butter & the water in the egg yolks amount to 88% of the flour amount. That is unusual high I would say. Although true shortbread cookies generally have a ratio of 88% to 92% butter to flour but has no liquids in it. They bake without any spreading.
You can try 50% veg shortening & 50% butter I think that will stop the excessive spreading. You see shortening has no water or liquids in it.
Anyway if you try the modification post back the results.
When I place the baking sheet in the upper part of the oven, the cookies spread less or didn't spread at all, the base of the cookies wasn't overcooked; and, the cookies assumed a nice domed shape and the "domes" themselves were nice and crunchy without being over cooked on top.
Your recipe looks fine but a couple of extra tablespoons of flour won't hurt anything if you want to add it in.
I looked really closely at your picture and IMO the dough was not rolled into a perfect cylinder before freezing .
That or you applied too much pressure on a too soft dough (when cutting cookie disks).
Try cutting with a serrated knife next time (get started cutting the second you remove the cookie roll from the freezer)
The sawing motion puts a lot less pressure on the dough cylinder and will lessen the chance of the cookie being squished out of shape.
Give the individual cookies a bit more room on the sheet pan as well.
I can tell they stuck together during baking.
When you pulse the powdered sugar, salt, just the zest, and the butter, it really has to look dry. Use a good brand of butter, as soon as it looks like sand, stop. You can cut the butter sticks in half lengthwise and turn it and again slice it in half length wise, then cut into 1/4 inch cubes. You can do this and separate the cubes a little and put back in the freezer while you scale the rest of the ingredients. When you pulse the butter in you can't do it to long, it really should be like sand, no big pieces. It will act like sand even if you put a spoon into it and move it around.. It shouldn't clump or create bigger pieces. That's to much. Then when you add the yolks and juice you only need to pulse until it starts to clump.
You do not have to pulse it into a smooth dough. In fact, when you dump out the dough it should not be all together. There should be large clumps and some small pieces. Then bring the dough together with your hands as you roll it into logs.
Remember to use powdered sugar in the ingredients and only the granulated to sprinkle on the frozen cookies. You can even pre-cut your cookies and place them together on parchment paper or plastic and layer them in something air tight and put back in the freezer. Then you can just take them out frozen sprinkle and bake. Top racks. Make sure you buy any kind of oven thermometer to make sure the temp in your oven is correct.
I thought I'd write it this way instead of trying to figure out what happened. Oven not hot enough, over mixed, not cold enough, etc.
My wife makes almost the exact same recipe. They are great to have stored in the freezer and just pull some out and bake if we have a craving for sweets. Also, the zesting can be done ahead of time and spread out on a pan and left at room temp for a while until they dry out a bit. If my DW can make these, you certainly should be able to get a good cookie. Sorry, I know this is long but when you bring the dough together and roll your logs, roll the log in plastic wrap and twist the ends so it is tightened and looks like a sausage.