Yes, you can. Please visit this forum post to see what is needed for the import process: Character Import Requirements
Yes! Past issues have been remedied with the 2016 spring/summer patch.
Absolutely not! Underlight is free to play! To get started, from the Underlight Home Page, click on “Account” and register a new KoiWare account. Once registered, from the Underlight Home Page, click on “Download” to obtain the client. — If you are new to Underlight, please review our gettings started guide first. This isn’t your typical MO”RPG”, this is REAL role play: A Guide to Dreaming