No idea why you should avoid lvl 5 refine but you should avoid 7.

Basically in the current game its tedious to colect medium refines but it is possible. Through group shop or monthly missions you can get a good amount, also weekly events usually has a way to clai medium refines.

However Advanced refines are very very hard to get. Besides sage world battlefields there is no way you can consistently get advanced refines.

When you refine through rebate and go from lvl 6 to 7, you get 45 (or something like that) wish points which is equivalent to 45 free advanced refines to use during the rebate. Thus it is recommended to go all the way to lvl 8 which usually requires around 100-130 more advanced refines. The increase in stats form a lvl 7 refined item to a lvl 8 is actually quite big so its completely worth it. Refining to lvl 9 requires up to 500 advanced refines so its not very realistic, hence most players refine up to lvl 8 each time.

As for what to refine, now that you are mostly around lvl 4-5 in all your ninjas equipment you should focus on refining and purifying the equipment of your move 1 ninja. Max him out, specially initiative.

Then do the same for all 5 pieces of equipment of your move 2 ninja. Prioritize the equipment that has purple initiative or a golden stat via purification, refine it to lvl 8 or 6 each time and give it to your move 1 or 2 ninja.

Once you have fully refined your move 1 and 2 ninjas go to move 3, although it will have less influence on the battles since most teams control on move 1 or 2. The advantage will come from the barrier.

As far as charms is concerned, maximize the charm level more or less steadily. However once again, when you have mostly lvl 3-4 charms everywhere, focus on the charm for initiative for the move 1 and 2 ninja. Also try to get 1 piece of equipment to lvl 6 if you can each time since that is equivalent to an extra rainbow magatama for said ninja.

This will take you a lot of time so dont ru*.