1) They RECOMMEND it for a reason.
2) I would see if a transmission sho can do this for you, unless someone can help out better here.
3) If you don't particularly like spilling the fluid when draining the transmission it would be a good idea.
4) New filter at minimum, you might be better off going the route of rebuilding it and installing the shift kit upon reassembly.
5) I don't have anything to help you out here.
7) I can't help out any more than I have so far.