If I have a MIDI noteOn callback, would it interfere with the MIDIfile handler, or does the MIDIfile handler only 'do stuff' for MIDI coming from the file on the sd card?
There is no logical reason it should (but that does not mean that it does not).
The MIDI library reads a serial port and then calls a callback to tell you a certain type of message has been received. The MIDIFile library reads the SD card and calls the callback for the user to deal with the MIDI event (which could be a message). If you want to you could use the MIDI library to send the message - that is what I used to do before I simplified the example code to reduce the dependency on yet another library (MIDI). The MIDIFile library boils down to reading a file on the SD card, interpreting the bytes (especially wrt timing) and then calling the callback to make the user handle the MIDI event however they want.
int err;
if (err != -1)
{
I still don't see what this does. Variable err has an undefined value when you are checking for -1 as you have done nothing with it.
I don't understand what you are trying to do with the code you posted. You cannot just assume that the MIDI file will be synched wih the other MIDI stream because there will be timing and latency issues with the comms, as well as slight differences in the clocking between Arduino and synthesiser. So the MIDI streams' synch will progressively diverge (small changes accumulated over a longer time) unless they are resynched on a periodic basis. That's the whole point of the time beat messages - to minimise or eliminate these differences - by sending a beat 96 times per note (a lot, IMHO, but who am I to argue!).