A watermark tells the reader what they are holding before they read a word of it, and discourages a draft being passed on as final.
Around 20 per cent opacity at a diagonal angle is the usual choice. It reads clearly without fighting the text underneath.
A single large mark in the centre is right for status words like DRAFT. Repeating it across the page is for discouraging reuse, because it cannot be cropped out without damaging the content.
The watermark becomes part of each page. Anyone can still remove it with the right software, so treat it as a clear label rather than security.
Yes, every page of the document.
The PDF tool takes text. For a logo on pictures, use the photo watermark tool.
No.