Yes. Ctrl+Z undoes the entire merge. Plus, if Non-Destructive Backup was on, your originals are preserved in the RigidAnim_Backups collection. You can restore them even after saving and reloading the file.

OFF (default): Each mesh stays separate and follows its own bone. You get one armature with multiple child meshes. In your game engine, each mesh becomes its own skinned mesh renderer. ON: All meshes are combined into a single object with vertex weights and an Armature modifier. You get one mesh, one draw call, one skinned mesh renderer. Better performance, but all materials from the original meshes are kept in the merged result.

Yes. In the panel, set Armature Target to Existing Armature and pick your target armature. New bones will be created inside it. If a bone with that name already exists, it's reused instead of creating a duplicate.

Yes. The addon looks at every frame of your animation and records exactly where each object is in 3D space, including any effects from constraints, drivers, or path animations. All of that gets baked into simple bone keyframes on the armature. The result works in any game engine with no Blender-specific dependencies.