Unfortunately, psychology terms/traits are difficult to quantify, e.g. I can't know someone is "10% narcissistic" in the same way I know a glass of water is "10% full". I agree, different people have different levels of narcissism.

To test my narcissism detection mechanism, I will look at how narcissistic the main characters of a few other popular books are. This is a better test than looking for narcissism in other characters in HPMOR (where the most-frequently-observed character is the most narcissistic). The evidence against narcissism is the opposite of the traits listed: average or low sense of self-importance, primarily interested in others, goals are usually about others, many relationships, etc.

1. Pride and Prejudice by Jane Austen: Grandiose? No -- Elizabeth has no expectation of becoming Queen or even, initially, of marrying a very rich man. Self-obsessed? No -- Elizabeth is concerned for her sisters' welfare as much as she is for her own. Troubles with normal relationships? No -- she has social contacts appropriate for her era and standing. Furious if criticized? No -- she reacts to criticism with thoughtful calm in public, followed by private reflection. Fantasies of unbound success, power, etc.? No -- she wants to marry a good man and live happily etc.
2. The Lord of the Rings by JRR Tolkien: Grandiose? No -- Frodo longs to remain in the Shire, at peace. Self-obsessed? No -- Frodo takes the Ring for the good of other people, and resists the urge to use it himself. Troubles with normal relationships? No -- Frodo is well-liked by the Fellowship and many friends attend his going-away party. Requires extreme admiration for everything? No -- Frodo is OK with being subservient to Gandalf. etc.
3. Watchmen by Alan Moore: Grandiose? No -- Dan Dreiberg (Nite Owl) retired from crime-fighting and lives quietly. Self-obsessed? Probably not -- While Dreiberg lives alone, he goes out of his way to help Rorschach and Laurie. Troubles with normal relationships? Maybe -- Dreiberg lives alone, and it's not clear what he does with his time outside of the events of the story. Fantasies of unbound success, power, etc? No -- Dreiberg is not seeking more power, and only reactivates his crime-fighting gear when driven to it by the events of the story. Feels entitled? No -- is frustrated but doesn't complain much at all when Dr. Manhattan takes Laurie to Mars.

From these negative results I conclude that my narcissism detector is working adequately.