WAAS Express is NOT part of Cisco IWAN.   PfR and WAAS Express do not interoperate.  As Finn suggested you should use the ISR-4K with ISR-WAAS if you want a full integrated solution. Or install an UCS-E and vWAAS.Reach out to your Cisco account team ...

Your understanding is correct.   Also in WAAS 5.x this is the default configuration  l2-redirect, l2-return, egress-method l2, mask assignment.

No this is not possible.  WAAS policy engine does not intercept non-TCP traffic.  Hence you can not classify / report on it.

WAAS does not perform any actions on non-TCP traffic.    If you are trying to apply some DSCP marking I'd suggest doing this on the switch or router before / after the WAAS device.