1. There were two types of merchant ships carrying aircraft during WW2, CAM ships and MAC ships.
Catapult Armed Merchantmen carried a single Hurricane aircraft on a rocket-powered catapult which could be launched on a one-way trip to attack enemy spotters (usually Condors). As far as I know they were only ever employed on convoys to Russia. Brave pilots.
Merchant Aircraft Carriers were oilers or grain-carrying ships that had their upperworks removed and replaced with a 460-foot long flight deck. They had arrester gear and a barrier, but no catapult, and 3 or 4 Swordfish aircraft. They carried their normal cargo and were used on North Atlantic convoys on anti-submarine patrols: no convoy thus equipped lost a ship to submarines. There's an excellent book "Bring Back my Stringbag", by John Kilbracken who commanded a Swordfish MAC flight.
2. The primary use of the catapults on WW2 carriers was to effectively increase the number of aircraft that could be launched on a strike. Ranged aircraft could be launched by catapult (often known as "accelerators") until the deck length ahead of the range allowed for the much faster launching of the remaining aircraft by free take off.
3. Great things, steam cats. As an exchange USN officer in 800 Sqn explained to a visiting group of finishing school girls once, "It doesn't half drag your f*resk*n back". It was the only thing the girls found interesting during their entire tour of the ship.