1: in "auto ISO", the camera keeps the ISO as low as possible, taking into account the focal lenght and the scene brightness to give you a speed that will be "hand holdable". Just remember that "hand holdable" isn't the same for everybody, so Pentax erred on the safe side.
2: Extended dynamic range increases noise in shadows, so I use it when the conditions are "extreme"
3: I find noise reduction in camera pretty good, but that is very subjective, and the informal testing I've done don't show a big difference between weakest and strong, so, when I use it, I generally leave it on "weak".
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