I know there are some crystals that require not only a specific alignment level (i.e. Light III), but also another requirement saying you can't be more than level 1 of the opposing alignment.

Any know if this type of limitation is on anything other than crystals? I'm curious as to whether I can go light side with most of my choices and then level up the other alignment through diplomacy missions.

If I understand you correctly, you're saying answer LS for conversations and rank up your LS points, then do diplomacy missions and rank up your DS points. Is that right?

If so, you cannot have rank 3 light and also rank 1 dark. As you gain LS points and DS points, they cancel each other out.

So let's say you are LS 5000, and DS 2000. You would actually be LS 3000, and would not have a DS rank.

I completely forgot about the point cancellation. Thanks or the reminder, that answers my question.

Although I wonder. If there's no cap to the LS DS points you can get, then I could theoretically continue to do diplomacy missions on one side to cancel out whatever imbalance I have.