12.8 volts should be enough for a heater. It's the same (or a little less) as the battery voltage. You can't get it higher.

Signal should be switching from lean (< 0.4 volt) to rich ( > 0.6 volt). That is the way closed loop is designed.

Was the co set at a correct level before? And if so, what was this? Something else may be wrong - like coolant temperature sensor or map sensor (hose).