This is brilliant. Anything which streamlines distribution has always helped the consumers and producers while increasing overall efficiency. Redfin is a good example, this looks like it will be another.
Not always. Redfin, maybe, since the middleman in that case is really more like an obstruction between buyers and sellers. Publishers aren't an obstruction in that sense. Sure, some of them could probably run leaner operations and give more money to their authors, but the publishing industry as a whole serves a very valuable purpose we don't necessarily recognize, because we're so used to it.
Depends, there is some use like content filtration. However the user ratings could fill in for a lot of that on amazon.
Also, as came up in another branch of the article's discussion, this could cause certain things like freelance editing to get a real boost from potential increased customers.