Personally, I use OpenGL and GLSL for game development because I enjoy learning the low-level graphics pipeline and making a game from scratch.

In the recent years, I've seen many employers want/require engine experience like Unity over OpenGL or DirectX experience(EA/Bioware). This is shaken my faith in what I am doing.

Question 1: Am I wasting time learning low-level development when an engine can do the job faster and with less knowledge?

Question 2: I'm currently a 2nd year BSc computer science student and have been building an OpenGL portfolio for the last year, and I would like know, am I on a good path?

Question 3: Will my experience in OpenGL be valued by perspective employers?

If you know how to program really well using a wide variety of tools, languages and paradigms you can pick up things like Unity in an afternoon so don't worry about it too much, knowledge is never wasted and no game engine is flawless off the shelf.

To get the most out of an engine like Unity you need to write your own shaders and sometimes you'll have to extend the engine using low level native plugins (or in extreme cases you have to get a sourcecode license and modify the engine directly)

Few companies will give such tasks to an entry level programmer though and many job ads are for entry level positions, a good employer will consider all your skills and how they can benefit the company, not just the ones they specifically ask for.

In the recent years, I've seen many employers want/require engine experience like Unity over OpenGL or DirectX experience(EA/Bioware). This is shaken my faith in what I am doing.

That depends on the open job position. If it's level designer or gameplay programmer, they'll probably prioritize experience with engines like Unity, UDK, etc.
If the position is "graphics engineer" "engine engineer" "low level programmer" or similar name, then they'll require DirectX, OpenGL, GLSL, HLSL, experience optimizing code, knowing how gpus work, how compilers work, and even assembly.

Question 1: Am I wasting time learning low-level development when an engine can do the job faster and with less knowledge?

You're not wasting your time. But ask yourself what do you want to do? If you want to make games, the fastest route and probably most efficient is to use an existing engine. If you want to make engines, or need a lot of flexibility (do you need it?) then learn low level programming.
Do you want to race?, or do you want to race with a car created from scratch by you?

Note that big companies nowadays have divided the effort: One team is responsible of making the engine (which is full of very-hard-to-find low level engineers) while other teams are responsible for making games with said engine.

So if you get to land on a job for a big company as a low level programmer, it's rather unlikely that you will end up actually touching any game (probably occasionally, when the game team needs assistance or it is a collaborative effort; or you're in luck and the company didn't isolate the game dev team from the engine dev team).

Question 3: Will my experience in OpenGL be valued by perspective employers?

Knowing a couple of OpenGL calls, or how to render a triangle with said api won't land you a job. Also note that the industry has a preference of Direct3D over GL (on Desktop, and also XBox, of course).
However if you're proficient with optimizing both glsl & hlsl code, know lighting theory (from multiple bdrfs like Phong, Blinn Phong and Cook Torrance to deducing the normalization factor for physically based brdfs by yourself whether analytically or through monte carlo), know how MSAA resolve works, and how rasterization is implemented in modern GPUs.
Then yeah, that's very valuable, and it trascends both D3D & GL (and there's very people actually interested in all this stuff). If you lock yourself to basic GL & GLSL knowledge you're no better than a regular programmer with Python knowledge whose job may require C (and has no idea of C).
But note that as any job where you want to stand out, you'll have to keep up with GDC, SIGGRAPH, and all other publications for the latest breakthroughs.
That also means following developer company sites very close for their latest publications. Because that's what low level programmers do.

If you want to get hands on straight to making the game, then you probably want to use all this stuff, rather than knowing why it works.

I'm pretty sure Notch doesn't know half of this stuff, yet that didn't stop him and had a lot of fun making Minecraft, and made 'a couple bucks' at the same time. Not knowing doesn't mean he's a bad programmer (on the contrary!), he just focused on other areas that can also be very important for making a good game.

Which path you choose is up to you.

However, a very common sight among Game Development jobs requirements was that one must have "-Shipped at least 1 video game title." This is slightly ambiguous to me. Does an indie game that has made ~$1000 satisfy this requirement, or does this imply a console/PC release title sold in retail stores/online market(ie: PSN)? Also, how does one break into the industry if almost all employers require previous experience at a games company?

Except in very special cases, requirements listed in job announcements in any industry are fuzzy. They list the skills they'd like to see in a potential employee, but none of them are set in stone. And it's (usually) not a checklist they go through when looking at resumes where they say, "Oh, this guy has everything we want, but he's never shipped a title. Next!" There are so many factors involved in whether or not you get an interview: how many applicants they have, the relative experience of the applicants, the temperament of the people sifting through the resumes, how urgently they need someone, and so on . If you have experience with the tech they are looking for and can show projects, shipped titles or not, that you've worked on, then that may very well be enough for them to talk to you. Then again, if you're up against resumes submitted from several people who have experience in the industry, you may very well not get the interview. But who knows? If you never submit the resume, then you're guaranteed not to get the interview.