1) all games work.
2) games from other regions can always brick with a "wrong" update, no chip in the world can prevent that. you CAN however edit the updates out of the images by now, given you take the time to read up a bit and get the software.
3) no.
4) yes and no. there are some games that were able to detect it due to a bug, but that has been fixed in the last wiikey firmware.
5) yes, with any of the ones that detect the chip (SSBB, mario galaxy, for example).
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Arakon
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