I heard that PA may addend the law and allow scopes on crossbows. Would you replace a red dot with a scope? If so, what magnification and which brand?

Yes, I shoot both, but scope is much more precise. Have a look at the Hawke MRP. 3X with multiple aiming points. Lot of scope for under $70.

I would also say yes, espically if you hunt with a rifle that has a scope, The red dots are nice but a scope is much more precise. I use a lumi zone and like it very much, never had to lite the crosshairs yet but it's there if I need to.