It's pretty much the same rules as there are for many similar things:
1) Who gets to decide who is Jewish/Muslim etc.
2) Mostly common sense
3) Depends on the definition, but using the negative connotation - then yes.
4) Not necessarily
5) Yes, you appeal directly to your audience
6) If it overlaps under their existing mandate, depends on the case.
7) Depends on the culture, but usually family is not sufficient.