Building an engine monitor - can it be done?

edit - answering OP Q. 7. (Realised reading later, using #7 may have been confused with ans #7! - apologies) Take a look at "Speeduino" and Megasquirt, lots of info, including interfacing with sensors, and also importantly, power supply protection and regulation details. Compatible with realdash and Tuner Studio (a pc/laptop based config and display/dash/logging program), and a few other Android apps that do dash display.

You may or may not use the fuel or ignition control, but auxiliary outputs can also be programmed to act on various input parameters which could (and can) be useful.

A speeduino (your own build customised to suit or purchased) would be a great place to start.