DNA methylation is an epigenetic modification with profound roles in transcription, genomic stability, and development. The discovery that Ten-Eleven Translocation (TET) proteins could oxidize 5-methylcytosine (5mC) into 5-hydroxymethylcytosine (5hmC), 5-formylcytosine (5fC), and 5-carboxycytosine (5caC) represented a paradigm shift in our conceptions of 5mC dynamism and regulation. TETs can drive active DNA demethylation in mammals through replication-dependent dilution of oxidized modifications (ox-mCs), or Thymine DNA Glycosylase (TDG) coupled excision of 5fC/5caC and Base Excision Repair (BER), to regenerate unmodified cytosine (C). Despite this, ascribing functional roles to ox-mCs, and distinct DNA demethylation mechanisms remains wanting due to technical lacunas that preclude causal interrogation. Thus, we developed a CRISPR/dCas9 epigenome-editing system to interrogate ox-mC functionality, coupled with integrative cytosine sequencing to resolve heterogenous epigenetic signatures and their relationship with transcription. We demonstrate at the methylation-sensitive RHOXF2B promoter, that 5fC/5caC/C, but not 5hmC generation, is requisite for robust transcription, suggestive of functional distinctions between active DNA demethylation pathways. Furthermore, promoter 5hmC enrichment could not restore C, suggesting replication-dependent dilution is more tightly regulated than previously envisaged in proliferative somatic cells. We further combine our platform with TDG co-expression to reveal a role for TDG catalytic activity in regulating active DNA demethylation beyond canonical 5fC/5caC cleavage. To identify context-dependent regulatory roles of active DNA demethylation and ox-mCs, we generated unbiased whole-genome deep sequenced datasets profiling 5mC, 5hmC, and 5fC/5caC/C following hTET1 genetic manipulation. Our findings identify bi-directional transcriptional dysregulation upon hTET1 isoform expression delineating a complex relationship between 5mC, ox-mC, and active DNA demethylation with transcription, dependent on underlying chromatin architecture and genomic context, that can be further investigated with our CRISPR/dCas9 5mC- and 5hmC- methylome-editing toolkit. Our work thus, innovates a system to interrogate ox-mC and active DNA demethylation functionality through causal manipulations with lucid cytosine base resolution to further advance future studies. Additionally, our whole-genome 5mC, 5hmC, and 5fC/5caC/C interrogation luminates the complexities of dynamic DNA methylation in mammals, contributing to our growing understanding of DNA modifications in gene regulation, variegated biological processes, and disease.