That's a lot of questions. Are you sure you want the answers instead of finding out yourself? That's one of fun things about XCF.
Does stacking multiple smoke grenades in the same place create more effective cover?
I dunno, but smoke dissipates and weakens over time. And you can "refresh" it.
For weapons, I dunno what your progress is, even if it's 1999. Here's some notes on usability.
The go-to weapon is laser snipers.
Throwing knives/stars are more of a "fun" weapon. Throwing ax, on the other hand, is unironically decent weapon, it can one-shot stuff you'll be struggling to shoot to (e.g. mib grunts, hybrid small and big drones, syndicate walkers). And 1999 is usually all about pestering mibs, so... keep an eye for some axed cavemen to get it.
There's fire extinguisher rounds for chempistol that make it handy little extinguisher for saving your burning soldiers. Very relevant when fighting against plasma in personal / cyber armor.
Plasma weapons/small launcher: sell, it's still a long way to researching and using them. And even then most of them are not very useful.
Staff of heart grip: it's lethal version of psi amp, decent psionics can kill from beyond the walls. Handy in underwater or in dreamscape.
Sonic pistol is decent on land, sonic rifle or cannon for underwater (need more punch for actual sea-dwellers).
Melee: Photonic spear is good on dedicated melee. Photonic blade is the holy grail if you can find it.
Otherwise it's kukri / wakizashi or mostly just plain punching / electric clubs.
Remember, you need to capture ~10 alien leaders / 20+ engineers to get to the "good" tech.
Punches to alien skulls make wonders there and pick up where EMP fails.
Blops: Macro SMG / Smartgun / Sniper rifles. Pistols to train rookies.
UAC: I somewhat like chaingun. For space you use lasers / plasma.
The rest: sell.
1. None. Tactical Grenade Launcher / Rocket Launcher -> Advanced rocket launcher / Mortars.
TGL is best anti-human weapon, decent sectoid capturing tool. The rest are situation-specific.
2. Not really.
3. Scoped. Should use none of these past promo 2, though.
4. Not all weapons scale from weapon's power, e.g. smoke has fixed 0 damage. Incendiary usually has fixed 5-10 damage, Napalm actually scales from power (50-150%).
For grenades, the difference is marginal - incendiary grenade has slightly more powerful aoe (damage doesn't drop off from center), napalm grenade is more powerful at ground zero blast, but drops off to the sides.
5. Yes, the aircraft rockets are basically garbage. Stingrays are at least buyable, so it's "best". Upgrade to mass driver cannons, then/or to gauss, but... they're not too good on slow and fragile ravens.
Once you build improved lab, you'll get some intermediate ship, same way as kitsune. That. That's the upgrade.