I think US anti-trust law, and various promises that Google has made to the authorities in the past as part of M & A deals, prohibit them from crossing the line.
They do not allow the AdWords spending to directly influence search results. There's likely some higher-order effects which could influence the results, though.
yes...but I'd bet they have a lot more recourse if they are a major Google customer...if a bug lowers your rankings..tough...but if you are a customer it'll get resolved.