Automatically switch to an alternate theme for Apple iOS devices (iPod, iPhone, iPad).
You may not. I honestly wouldn't unless I was producing a full-Flash website with WordPress as a backend.
Try it! The free version does not currently support iPad, though, and I felt that it was overpowered for my needs.
Theme switching is done independently for each concurrent user. You need not worry about non-iOS users seeing the alternate theme.
Yes, but you may need to conform a few technical things. Continue reading for specific cases.
The internal WordPress
id's must match in both themes for menus/widgets to work consistently.
Yes. Check out this WPtouch article.
At this time, you will have to edit the plugin file itself on line 16. Put in the folder name of the theme. Eventually, I will create a proper UI.
This plugin has only been tested with versions of WordPress as early as 3.2. For anything older, you'll have to see for yourself.