1) He likes to have 15-20 per platform. Not all are listed in the docs, and BoA had an abnormally large group of testers.
2) Yes, but also tedious and repetitive.
3) Yes, but also fun.
4) Your name in the credits, a free copy of the game, and a jump start on the next game's testing.
You will need to go over every inch of terrain at least twice with at least two parties, record every little thing that's wrong (and that's usually quite a bit), and make a nuisance of yourself.