What constitutes excessive chest hair on females?
What is the best method of hair removal? 
There’s a scale that quantifies hair on various areas of the body called the Ferriman-Galwey score.
There’s quite a range of chest hairt that occurs natually on females. I’ll see if I can scan the illustrations one of these days. All women have a few long wispy ones here and there. Those who get coarse hairs have them most frequently around the nipples. The next most frequest area is a vertical line of hair down the center of the chest. Some women have the coarse hairs spreading from the midline toward the breasts and collarbones.
If you just have a few around your nipples, you can trim them if they’re wispy, or pluck them if they’re coarse. If there are just a few, and you want them gone for good, electrolysis is your best bet. In fact, electro is your best bet unless you have a lot of really dark coarse hairs and light skin, then laser might be a useful option. This is probably only necessary if you have a lot of hair, almost to the levels mnales have.
Luckily, chest hairs are pretty easy to kill. Another option you might discuss with your doctor is anti-androgens, especially if you have a lot of body hair. Sometimes it’s cause by hormones levels, and an anti-androgen or other prescription drug might be helpful. There are significant side effects with these sorts of drugs, so you need to speak with a doctor, especially if you plan to have children or breastfeed.
Hope this helps!
But I heard you should never pluck or electronysize (made up word 
) around the nipples. I have no idea why, but for example, home electrolysis devices always say - don’t use near nipples. Is this just silly? (I find many product warnings to be silly and unnecessary, honestly) - or is it true?
Home use devices carry warnings not to use them around the nipples. Those seeking electrolysis in this area should consult a professional electrologist. It won’t be terribly expensive to get such a small area done by a pro.