1) Reduced recoil feel, as well as the ability to adjust the spring for the shooter / handload you may be using. Lighter loads, you'll need a lighter spring to keep it cycling. Some of us are more confident with a one-piece guiderod and washer, as there are a few instances of the stock two-piece guide-rod "gurnading" and sproinging out the front, causing all sorts of weirdness. Don's rod is easier to clean than the stock guide rod (More an issue for XDV10's). Eventually you'll need to replace the stock one anyway, so replacing it with a prettier aftermarket one now, and then only having to buy a replacement spring instead of the whole assembly. Win win win.
2) Manual says the XD uses 6 o'clock. But it varies from ammo to ammo, pistol to pistol, and shooter to shooter. Figure out what works for you.
3) If you have a .40s&w or a .357sig, you can change to all three XD calibers.
4) Yeah, someone does.