1) I prefer TI, 'cause it's pretty stable and you can adjust it's speed (that can save you from DC'ing to death), TII's only after late 1940
2) The closer the better, but never closer than 350/370m though
3) As long as the depth is adjusted correctly it won't matter, a dud will always happen though
4) Depth is variable on the weather, the higher the waves the higher the threshhold, 0,5m - 1,5m under the keel
5) Don't be affraid to use Kretchsmers tactic, one ship - one torpedo, spread is useful on heavily escorted convoys though
Check the community manual, GWX and SH3 manuals, you'll find everything you need in there.