During the Turn(not straight upwind or downwind)the aircraft has to be accelerated + or - with respect to the ground in order to maintain flying speed.
Yes - but it also has to be accelerated (change of velocity) with respect to the air - exactly the same acceleration, just a different frame of reference.
This takes time ,and has to be paid for with engine power or gravity(potential energy= height]
Yes, higher induced drag in the turn to pay for the inclined lift vector which is accelerating the aircraft.
If you take the extreme case of an instant turn (on the spot) you can arrive at a minus airspeed.....So??? (Dont ask, Ive been there done that )
Exactly the same as an aircraft flying past in dead calm air, and suddenly "magically" swapping head for tail - it ends up zooming past tail first, with negative airspeed.
Consider further the interesting situation you were watching from the balloon,
Perfect circle ? Constant G?? Constant angle of bank???....I dont think so
Yes, perfect circle (given the same steady wind conditions for the balloon and the model) Yes, constant G. Yes, constant angle of bank.