1. I haven't seen it specified. Go ask your DM.
2. No. What this means is that Magic Items or Magical Effects or Special Abilities that affect only Elves will also affect Half-elves.
For example... If a magic wand can only be used by elves, then it can also be used by half-elves. Boots of Elvenkind can only be made by elves, so half-elves can make them too. An Arrow of Elf Slaying will also kill an half-elf, as will a Sword of Elf-bane. A Ranger with Favored Enemy: Elf, will also get his bonus against half-elves.
Make sense?