I'm glad the pylon issue has been raised - it's certainly a weird point in the construction of a Starship!
Regarding the in-universe naming of these decks, it only really occurs in three episodes:
Mudd’s Women: Kirk’s cabin is on this deck [i.e. 12] (apparently) and has a decent stretch of corridor adjoining it. As has been repeatedly pointed out, there is no way to squeeze this all into the pylon (horizontally anyway - thanks
Timo for your usual skill in bursting the envelope!)
Enemy Within: Rand’s quarters are blatantly on this deck (G. T. Fisher calls for aid from an intercom) and even more corridor is visible prior to this on Evilkirk’s drunken ramble to her door. Regarding this ramble, why is Evilkirk even here? The presence of Rand’s cabin seems to take him almost by surprise, just a fortunate opportunity to be taken advantage of. I would postulate that he is going back to his cabin and just happens to pass her own along the way. In fact, at this point in the series, “Deck 12” is almost being treated as the main deck of the ship, hardly suitable if that deck were situated in the pylon neck.
Dagger Of The Mind: Here, Van Gelder is spotted on Deck 14, having (apparently) exited the Transporter Room and started roaming the corridors. There is not indication that he ever used a turbolift – if he had, wouldn’t he have gone somewhere more secluded? Or if his ultimate destination was in fact the bridge – why not there? To detour via the pylon neck is an odd choice, even for him! ...
So, if the lower saucer rim deck is deck 7 (personally I think deck 5 is more accurate but that’s another debate) then the pylon takes on decks 8, 9 and 10, leaving the Engineering hull to begin fresh at deck 11. Deck 12 is then situated slightly down into the secondary hull, plenty of space for everything seen on screen!
P.S.
If the pylon neck decks end at deck 10, this is similar to the lowest of the saucer decks. Maybe the emergency separation actually occurs at the bottom of the pylon instead of the top? This would have the added bonus of keeping all the numbered decks together…
P.P.S.
I just realised, this last bit has been thought of before, in the Star Trek Officer's Manual:

(click for link to full size - thanks to
http://www.cygnus-x1.net for this resource)