Is an agent necessary or recommended when an author signs with a Small Press or ePublisher?
That varies by publisher--always check the publisher's guidelines and follow them. If they say "agented submissions only", they mean it. Yes, it is true that most small presses and e-publishers do not require agented submissions, and most big NY presses do. But there are variations.
If you do not have an agent and you receive an offer from a publisher, decide quickly if you want to use that offer to try to secure an agent. This assumes you've already done all your research on agents and have determined a few who would be a good match for you and you'd be interested in working with. You could now query them stating that you have an offer in hand.
Most authors at e-publishers do not have agents. Contracts at e-pubs are generally pretty standard for all authors, with fewer areas open to negotiation, so there is less need for an agent to handle the contract process. For example, it is typical for all authors at a given e-pub to receive the same royalty rate, no variation. However, be aware that you can hire a literary attorney or agent (at an hourly rate) to review a contract offer for you; if you have any concerns about your contract, you should seriously consider this option. (Just be sure you use someone experienced in the publishing industry - advice from your brother-in-law the divorce attorney is worse than no advice, because it will be inappropriate if not downright wrong, and will make you look unprofessional and unknowledgeable to your prospective publisher.)
I'm curious to know how important it is for an author making a query to state which line of the publisher's products her submission would best fit? After all, several publishers these days have significant numbers of different product lines where the only real difference in the published works are varying levels of sexual explicitness or length of the finished work.
Well, if you are submitting to Harlequin, you must address your query/submission to a specific line. However, things are a little more flexible for most other publishers. Of course, you should make sure you are addressing the right area of the publisher--and the appropriate publisher--to start with. You're not going to send your mystery novel to the science fiction editor at Simon & Schuster, right? Nor send your erotica to a publisher who only does inspirational books. Check the publisher's website to determine where to send queries and submissions. Sometimes there will be a list of editors acquiring for specific genres. For some publishers, which includes most e-publishers, there may be just a generic Submissions address.
Your query letter should clearly and briefly state the genre of your story. For romances, it is also a good idea to indicate sensuality level. But keep it high level--label it as "contemporary cozy mystery" or "paranormal romance" or "historical fiction set in post-Civil War England" or "futuristic erotic romance with BDSM elements". The editor will determine where this story would fit in the publisher's lines. Especially if the story is cross-genre, you don't want to get yourself ruled out by indicating a line for which the publisher is already full, or that is perhaps not selling as well. If the editor falls in love with your story, she or he will figure out how to present it.
Ask the Editors is a semi-regular (meaning, whenever we feel like it or we've gotten some good questions) column. Send your questions about editing or publishing to RedlinesDeadlines@gmail.com.