Under 2 MB, for upload limits
No. It all happens in your browser, and the file never leaves your device.
Text-only PDFs almost always do. Almost any everyday document already is: a 10-page colour scan comes out untouched. Squeezing starts to show on scans of 30 pages or more, or photographed at very high resolution. If it can't be reached you get the smallest readable version and a note, and splitting the PDF or removing pages is the way through.
Not if the pages had to become pictures to get smaller: then text can no longer be selected or searched. When the file is already small enough, it comes back as it was. Keep the original if you need the text.