The Scots' kings by the time of James V were still being addressed as 'your Grace', so I could see Edward III taking "your Majesty" if a son of Margherita's inherits the imperial title during his life time. But I agree, it probably would cause friction between London and Edinburgh. As to David having no kids, it's an interesting point you raise: he was in France for a long while, so that could account for why he and Joan had no kids at the start of their marriage (as I said upthread, I'm not sure where she was), but it doesn't explain after they were back together. Although David was hostage in England thereafter, and when he was released, Joan didn't go with him back to Scotland. So maybe the fault was on David's side.
Any people who know more about Scottish history of the period?