I've done that mod. Drug the spare tire pretty hard last night doing some light after work wheeling. The longer bolts and nuts I'm using for spacers held up well.
1. Works with handcrank as long as you don't try to raise it too high, you'll see what I mean when you do the mod.
2. No downsides that I've found.
3. Yes, works with 285/75 as well as 305/70