Yea its doable. Really depends on the games anti-cheat. You’d want to check each game.
Battle Eye based anti cheat games like R6S and Tarkov gave me issues last time i tried a similar setup. That was a few years back however, and with valves proton push, much of the compatibility has improved since then.
1: there is, but at this point its pretty niche and scattered. Lots of its hush-hush due to like you said potential security/insurance concerns. Mostly used for cracking and getting system/diagnostics readouts and error codes, Fob cloning, etc. without forking out cash to do so through the so called “proper channels”.
2: not that I’ve seen, and from they software they do use it seems mainly in house additions.
Though im not super into the scene, and i see it growing rapidly over the next few years seeing manufacturers keep doing some scummy shit to lock down their products.
Edit: fat fingered post before i finished typing it out oops.