5% loss isn't that bad, but that's because they're being limited in a lot of ways to keep the efficiency high. Dropping current and increasing voltage, for instance. If you had a 100% efficient conductor, you could do things like transmit monstrously high levels of current without having to worry about stuff like that.
True, although the superconducting effect is lost under high electric fields.
A superconducor rejects magnetic fields (a bit like a Faraday cage). What if you cranck it up high enough and force the superconductor in place? You lose superconductivity.
For that reason, there is actually a limit to thew current that can be transmitted, though it is much higher than with conventional cables (you still can't power a city with a hair-thin cable, IIRC).
