re: #2 Absalom, Absalom, Obdicut
A lot of the people who have freaked out about this have moved onto an idea that the NSA has switches at every fiber-optic backbone and are simply siphoning off all the traffic that way.
This is based off of, I believe, the (confirmed?) AT&T NSA switching room.
Confirmed if Wired got it right. Locked closets at ISP’s & hubs.