1) Yes it does. Used it last week without incident. It should also opens the barriers at Durham and Darlington if you go there. Although the leaflet says you can't use it on GC services, their website doesn't say that, there is nothing on the Northern page that says it as well and GC have in the past said they would accept rover tickets valid to their area.
As for 2), Newcastle - Middlesbrough is hourly, Newcastle - Morpeth is hourly (Northern services only, also served by East Coast and CrossCountry), Newcastle - Chathill is two per day, Newcastle - MetroCentre shuttle is one per hour (usually runs from Morpeth), Newcastle - Hexham stopper is 1 per hour (from Middlesbrough) and Newcastle - Carlisle is 1 per hour.
Saltburn - Darlington services are every half hour, and every 2-3 hours they run through to Bishop Auckland. Memory says that there are 3 or 4 Middlesbrough - Whitby workings a day, but they are infrequent and it takes a while to get to Whitby, so only really worth going for a full day there.
Some workings can be mixed up a bit, some of the Hexham - Middlesbrough services run through to Nunthorpe, and the early morning services from Saltburn come via the ECML and Durham, which is the only time you'll see a 142 at Durham. There is also a late night Newcastle - Saltburn service which goes via Durham as well. Some of the MetroCentre - Newcastle services are formed of ECS workings from Newcastle. If you're lucky you might see a 2x142 working. I was on one that was booked as a single 142 to go from Saltburn to Bishop Auckland, but it turned up as a double. For some reason at Middlesbrough people going to Darlington had to board a 142 in front, and the 2x142 then went to Hexham via Hartlepool.
Finally, some general timings:
Newcastle - Morpeth 15 mins
Newcastle - MetroCentre 10 mins
Newcastle - Hexham 25-30 mins
Newcastle - Middlesbrough 1h 20 mins
Middlesbrough - Saltburn 20-25 mins
Middlesbrough - Darlington 20-25 mins
Darlington - Bishop Auckland - 20 mins.
If you plan to go to Bishop Auckland, the line was supposed to be closed between Shildon and Bishop due to bridge engineering, and a bus was replacing trains. Problem is I can't remember when it was due to end but it was definately starting last week.
Hope this has been of some help! Quite a lot to read I know, but being local has it's uses!