That seems a little outdated, aren't most theaters using digital HD projectors now? They should be IMO... I've got one in my bedroom and it's why I don't go to the movie theaters anymore. :)
They're slow to switch. Mostly because consumer HD pales in comparison to 35mm film, quality wise, when you blow it up to a diagonal of 6-8 metres or so. As far as I know, digital cinema projectors have a "4K" resolution (4000 x ~2000) and are fed the film from a stack of terabyte hard disks. The projectors are SERIOUS money.
Not really; until recently there were still more new film installations than digital.
The cost of film is on the distributors and studios, but the cost of moving to digital is twice a film projector and falls on the theatre owner (who already has working film equipment). So the distributors (who aren't technically needed in the digital era) are trying to find a way to stay relevant and the studios have been subsidizing the cost of digital installations, so it has been very slow going.
I worked at a movie theater last year. They began firing projectionists. Even then, things go wrong. Films get off-focus, the sound messes up, the display corrupts. Even if they don't people will complain, and then you have to go up and fiddle with it so they stop coming. It's rarely relaxing.