We have a major utility company using a new system that is putting the check endorsement of FOR DEPOSIT ONLY length wise of the check on the opposite end of the check from the endorsement section. Is this ok?

When someone had to actually read endorsements on the back of a check to figure out which bank to return an item too, it was probably more important to color within the lines. With today's automation, it is probably not that big of a deal.

Acknowledging that bank operations have changed, I would still point out to them (in writing) that regulations regarding endorsements have not; theirs is in the wrong place.