Ah, but you're overlooking the fact that that's why he HAD to interfere. If he hadn't sent his men to capture Alvin and kill Geralt it would have been just as destructive to the causal loop as if he'd actually succeeded in killing off the Witcher earlier.
And no, Geralt could not have prevented Alvin from becoming Jacques de Aaldersburg because it already happened from Geralt's position. Without getting into the various conjectures about the logic of time travel, the simplest way of putting it is that it is presumed (given what we know IRL of physics) that even if time travel WERE possible (which it most likely is not), a time traveller can never change the past, with the past being defined relative to his starting point. Therefore since the Grand Master already existed prior to Alvin's birth (possibly even prior to Geralt's), it was inevitable that Alvin would become the Grand Master.
This is why in many fantasy settings (like the Dresden Files books by Jim Butcher) magical time travel is a big no-no. It doesn't bother me as a plot element in this story, though, since it was done well and gave the character of the Grand Master a real tragic edge.
As for some of the other questions raised:
"Where did all the other Witchers get off to?" - The other Witchers are probably either still searching for clues or have gone back to their normal lives. Remember that Witchers, once they're done with their training, spend most of their lives in solitary travel and only rarely gather together at the Witcher schools and strongholds. I haven't read the books yet, but it's pretty clear from the glossary entries and so on that MOST Witchers stay out of political conflicts and have no allegiance to any one kingdom (monsters in Redania needing killing just as much as monsters in Temeria, for example). I think Geralt's involvement in political struggle is the exception, not the rule, which ties into the next issue...
"What's with the assassin?" - I think it's pretty clear that the assassin is A) a Witcher (the potion belt, altered eyes, combat style, etc) and B) not one that we saw in the game. Just because Geralt seems shocked doesn't mean he personally recognizes him. Remember that Witchers are supposed to be apolitical and focused primarily on killing monsters and dealing with the victims of magical curses. Finding a witcher as an assassin would be pretty shocking.
As another note: While the mutations express differently in different Witchers (Geralt's white hair is unusual), some of the changes are universal. The unusual eyes are SUPPOSED to be a universal change, and that's made clear in both the dialogue in the Prologue and in the glossary entries even if it's not reflected as clearly in the in-game character models of the other Witchers (the third stage of the mutation after the Trial of the Grasses is mentioned as including changes to the eyes to give witcher's better low-light vision).
Finally, a bit of recommended reading for people intrigued by or troubled by the idea of the predestination paradox (aka the closed temporal loop, aka causal loop, etc, etc). The short story "By His Bootstraps" by Robert A. Heinlein is one of the better examples of this sort of paradox and does it in an interesting way.