The Step-Up: You're Doing It Wrong
You don't see a lot people doing the step-up. They probably tried it at one time but decided it just didn't work. The problem is, most people don't do it correctly. Most lifters unknowingly cheat on the step-up by leaning forward too much and pushing off the bottom leg. When you push off the floor leg, the leg on top of the box or bench isn't doing much work.
Make It Work: Curl Up Your Toes
To keep from cheating on the step-up, curl up the toes of the foot that's on the floor. Keep them curled up during the movement. This keeps you from being able to push off from the bottom leg so easily, because in order to push off you have to keep the toes down.
As for bench or step height, you can go very high. The highest you can go is when the bench is so tall you're up on your toes. It's called the triple-jumper's step-up and it involves the VMO and hamstrings more. It's basically just a super high step-up. The key is that your knee shouldn't buckle in as you step up.
You can alternate legs or keep one foot statically on the bench until you do the desired number of reps. If you want more time under tension, use the static method where the foot up on the bench is kept in place. You can do step-ups using a barbell or dumbbells. They're all good variations. Just keep your toes up.