If there's a slow car in the outside lane, and they're not making any attempt to overtake anything, you generally flash them until they move over. They are, after all, breaking the law.
What if a car is in the passing lane doing the speed limit? Asking them to move out of the lane so another driver could pass by speeding, breaking the law, doesn't make much sense either.
Yes. It's amazing to watch if you're used to driving in the US. You'll get an unbelievable amount of grief if you allow yourself to be approached from behind in the inside lane. Even driving in the center lane, you are expected to move outside if there is room to do so. Try driving there long-term and you'll get fast drivers cutting you off from the passing lane just to teach you a lesson.
And no, nobody passes on the outside. Even if you're about to exit and the rest of the lanes are moving slowly, you'll still slow down considerably and look a bit sheepish as you drift past the main highway traffic.
It is the same in Germany. I always assumed it was that way everywhere.