1. Yes. A definite no no unless you enjoy the smell of burning panniers.
2. Yes...oh yes! Mine is increased to give about 5mm of air between the bottom of the tyre & the ground when on the centre stand...much better.
3. Difficult one this.....dependant on weight of both of you etc... I see to remember now that the settings given in MCN for the 4S had the preload backed off 7 turns of the adjuster from full...mine is not quite that hard - Ithink its about 10 in from soft but I don't ride 2 up.
No doubt there are some on here who do & can give a pointer on that.
Cheers
Andy