1. No damage taken. They take a small hit to morale, but that is usually negligible.

2. It just makes much more of a difference on low level units and heroes. So i usually use it on the army that has the least xp at that given time.

3. Afaik it just means increased spotting range.

Illusionary battle gives 20-30 experience to each unit. This is enough to get first level for most of the units, but pretty insignificant for seasoned units. 7 -> 8 level up needs 90 exp for expmod 100 units.

Total exp from this ritual for 16 units (hero+15) barely equal to 2 trolls. When you can field these hordes, you can get way more exp than that.

Only 1 use - hire horde of fresh units with good skill on first level up and use it. Dismiss those who failed to pass test. Meditation for healer, healing for fairy, doubleshot for slinger.

The guards allow you to see one more tile away - so you can see provinces two tiles away. It does not explore the province! Possible uses can be:

1. Scout... especially if you have a coastal province. You can jump across the sea using a port but you need to see the province first!
2. Improve population mood - it conveys +1 happiness.
3. Emergency guard - especially good against an enemy who brings lots of squishy casters, at least you should get rid of a few!

BTW 1 depends on your map, I have very rarely used it. 2 & 3 are theoretical [I haven't encountered any situation where this would be a better solution than other available options - I normally get better happiness buildings and more powerful guards before I get this ritual; not counting item drops].