It is a threaded collar wound down by hand against the cylinder head once the load is raised, so the load rests on a solid mechanical thread instead of on trapped oil. That removes the seal as a single point of failure for as long as the load is up.

No - it must be wound down deliberately after lifting. Raising a load and walking away without setting the collar leaves exactly the risk the jack exists to remove, so setting it belongs in the written procedure rather than being left to the operator's memory.

The collar is backed off first, then the release valve is opened. Attempting to release the hydraulics against a set collar does nothing useful and can damage the jack, and it is the usual way these jacks get mistreated by someone unfamiliar with them.

Propping and shoring, holding structures during modification, marine and offshore work, and any sustained lift measured in hours or days. The common factor is that the load stays up long enough that relying on hydraulic pressure alone would not be acceptable.

In the sense that it provides mechanical support, yes - that is the point. Whether it replaces them in a given procedure depends on the risk assessment and the applicable rules, and the safe practice on vehicle work remains to use stands regardless, since they cost little and remove the question entirely.

No - the collar and the threaded ram are integral to the design and cannot be added afterwards. A jack either has the feature or it does not, and aftermarket arrangements should be treated with considerable suspicion since the thread is carrying the whole load.

Keeping the thread clean and lightly lubricated so it winds freely and seats fully. A collar that is stiff with grit or corrosion will not be wound fully down in practice, which quietly removes the protection the jack was chosen for while appearing to be set.