It's an incremental step on a long road. To be sure, the ultimate goal is to understand how to control the plasma well enough to support indefinitely long pulses. But incremental improvements add up, or rather they compound like interest.
Yep, steam turbines. For more exotic fusion scenarios that don't produce neutrons, Direct Conversion is a possibility, but that's even more pie-in-the-sky at this point.
Yes. That also makes it difficult to scale up to energy production - now you need to route a bunch of cooling water plumbing and heat exchangers around it, engineer it to transfer the bulk of the reactor heat output to the cooling water without melting any heat exchangers, then build a turbine/generator rig to attach to it. Might possibly need an extra water loop too, depending on how much neutron flux ends up hitting the water and plumbing when running at a reaction rate sufficient to generate power.
Actually no, the heat needs to escape to keep the temperature under control. The temperature is what has to be kept in the proper range for Fusion to occur at the planned rate. I don't know as much about control of fusion reactions as I'd like, but I think the reaction rate is highly temperature-dependant, so we'll want to keep the temperature in a tight range. Too low a reaction rate, and the plasma cools down too much and would have to be re-heated externally; too high and you might burn up fuel faster than you can resupply it, causing what I guess you would call a stall, also requiring a restart.
All of the reactions we've generated so far have a low to nonexistent reaction rate, because the reaction generates lots of heat, and the research reactor designs we're using don't have a way to extract that heat at power-generation levels. To build a power reactor, we'll have to maintain the reaction temperature, at which massive amounts of heat are generated, and extract that heat to keep the temperature stable.
Designing the heat transfer for that is sure to be fun. I don't know the temperature of the burning plasma, but I'm sure it's insanely high compared to any kind of conventional material or process. So somebody has to design a system to transfer GigaWatts of heat from a burning plasma at effectively infinite temperature to some perfectly ordinary water at a controlled rate without melting anything.
I don't think the plasma being too hot is a problem in a tokamak. The average ion energy is not enough for fusion; we rely on the high-energy tail end of the Maxwellian distribution. Any potential source of heat loss from the ions is a liability, including the natural predilection for ions to transfer their energy to electrons, not to mention radiative losses. Keeping the plasma hot enough is really the essential problem.
AFAIK, the goal is not necessarily indefinitely long pulses, but pulses long enough to allow for a net positive energy output. This is the reason why there is also pulsed laser research, etc. The bar is high, but we don't need perfection to make a lasting impact.
