1) Save the game and try ditching each character and see what convo you get.
2) No quests carry over. But some crafting materials have expanded use in other games. Storyline premise carries over.
3) I think the story in BG2 does a good job of painting all the continuity pictures you need. Just enjoy the ride.
4) I always end up hoarding scrolls (except for the rare spells that I have to have). Matter of taste. About Xzar... good luck with that.

Forewarning: I haven't played EE, only the base game. I believe this information is still (mostly) accurate, though. Also, mods can change pretty much any of this behavior. Depends on your reputation versus their alignment. If your rep is too high (19-20 ish), then evil and neutral characters will leave forever if you remove them from the party. However, at that reputation level, evil characters will leave anyway because you're being too good.

If they don't mind your reputation, then I think they generally just stand where you dismiss them.

A few characters are part of a package deal, where they leave your party if you remove their companion from your party. Xzar and Montaron stay together, and Jaheira and Khalid stay together. Minsc and Dynaheir will also stay together. This automatic leaving only applies when you reform the party and remove one of them; they don't leave if their partner dies. No. No quests carry-over, and only a select few items carry over. The true answer is "Depends on your combat style." :)

Having at least one arcane caster is very useful (mage, bard).
Having at least one divine caster is very useful (cleric, druid).
Having someone with thief levels is very useful.
Having someone that can survive in melee is very useful.

You have a fair bit of flexibility in how you run combat, so you can basically use whomever suits you.
My play through consisted of
-Me, Fighter - Built to be a primary frontline tank and melee damage dealer, using longsword and the best shield and armor I had.
-Ajantis - Back up tank with some emergency healing. Used mace and shield when tanking.
-Kivan - Primaily used a bow, but pulled out a polearm if I needed him to step into melee (whether the two main tanks got too battered, or enemy numbers/positioning meant guys were getting to the softer party members).
-Branwen - Divine caster/healer. Preferred a sling but pulled out a mace if she had to.
-Imoen - Thief. Preferred a bow.
-Xan - Arcane caster. Sling or darts. Sword was used only for clean-up duty (enemies all disabled, etc.)

My PC and Ajantis would hold the line while the rest focused fire on targets. Xan primarily handed out disables in tougher fights and removed enemy buffs with Dispel Magic. Branwen handled healing and some summons as a buffer. Imoen handled traps, locks, and some scouting.

For you, your cavalier can melee, Khalid can also tank, Jaheira heals, Imoen handles locks and traps. Xzar and Montaron have arcane casting and thieving covered, but you'll have issues keeping them in your party. There aren't too many character stories in BG1, and most of those are front loaded. Pick classes and personalities you like, as long as alignments are compatible. I had my mage learn every spell they could, just so the spells are available. Learned spells are repeatable, while scrolls are one-shot. There are plenty of scrolls of the more common spells so you can use those to supplement your spell slots.

That said, don't teach spells to any mage you don't plan to keep long term. As a paladin, you need to keep your reputation from falling too low in order to avoid Falling and losing your paladin abilities. Xzar and Montaron are evil, so they'll ditch you if your reputation gets too high. Also, I've heard that Xzar and Montaron will eventually fight with Khalid and Jaheira, so you'll need to make a choice there.

I suggest dumping the Xzar pair. Your options are pretty open from there, so pick someone that adds more of what you want in your party. Ajantis adds a good melee option, Kivan and Coran both add good ranged damage, Minsc + Dynaheir add a good melee and a good arcane, Yeslick adds fighter and divine, etc.

The canon party leading into BG2 is Khalid, Jaheira, Minsc, Dynaheir, and Imoen.

Don't bother too much about the optimal party composition, just pick up and dismiss whoever you like. It's not worth bearing someone annoying just because it makes your game a little easier.

Thank you everyone for the replies So this is the canon party? does it have a healer?

Jaheira is a fighter/druid, so she can function as a healer. She won't have access to Raise Dead or Resurrection, but gets all the other major healing spells, and she does get a spell that's similar to Raise Dead, and can optionally learn Mass Raise Dead eventually.

(Interestingly enough, Jaheira needs fewer XP to learn Heal than a single class cleric; blame 2e's strange XP tables (and in particular the bizarre druid XP table) for this.)

Also, Minsc, being a ranger, can eventually cast Cure Light Wounds. One might not think of him as a spellcaster, but he actually can use a little magic,

(Note that Jaheira won't learn the powerful spells I mentioned in BG1. Minsc can get one cast/day of Cure Light Wounds in BG1 if you have Tales of the Sword Coast (including in both GOG verisons), but that's not going to be of much use at that point.)

When Jaheira can cast lvl5 I love her insect plague spell for when you have to face a group with a bunch of mages and clerics. Takes them out of the battle (and everyone else) leaving only mop-up. I think you have to wait for BG2 for l5 spells, tho. But yea, she can heal a bit.

Khalid is a Fighter. As dtgreene noted above, Jaheira is a Fighter/Druid multi-class. Minsc is a Ranger. Dynaheir is an Invoker (specialist mage (arcane caster)). Imoen is a Thief (and, per canon, dual-classes to Mage late in Baldur's Gate 1, but you are not required to do that).

Given those class descriptions, Jaheira is the only one who can offer you magical healing. Magical healing typically comes from Clerics, Druids, and Shamans. You can also get a small amount of magical healing from a Paladin's Lay on Hands. As the story progresses, the protagonist may (depending on how you designed him/her) gain some uses of Cure Light Wounds. This is helpful, but I would advise against treating that as your primary source of magical healing, because it will not be numerous enough per rest cycle to make a difference in major battles, and because you will only gain it slowly over the course of the story. In the early game, you will not have it at all.

If you want to play the canonical party, and want not to give the protagonist a divine caster class, you should plan on using potions. As I understand it, this is often not very cost effective, but if you are skilled enough at avoiding damage, it might work out. I'm not aware of any penalty in BG2 for not playing the canonical party in BG1, so you could choose to recruit a different set of companions, or even make a larger party of your own and ignore some placed companions. Beware that some companions were apparently created in violation of the rules, so you can't necessarily make an equivalent character on your own. Among those that come to mind, there is a half-orc Blackguard, which is not a legal combination for player-created characters, and a Cleric with a special ability that you cannot assign to a player-created cleric.

Minsc is one of them; his Wisdom is below the minimum requirement for the Ranger class.

Yes. Jaheira is a Fighter/Druid multi-class. Druids use divine spells, including the Cure [X] Wounds.

There's not really a canon party and there are no rewards for playing just the characters some call so, actually other party members offer more depth and content, the save which was originally released with the expansion had different characters in the party.

It is true that there is no requirement to use any of these 5 (and as noted above, I only used Imoen in my party). However, this feels a little disingenuous. The canon party is called the canon party because it is the group that "starts" with you in BG2 when using the default installs. Mechanically you start BG2 alone with no party members, but these are the 5 BG1 NPCs that are stated as having been abducted with you in between BG1 and BG2.