varies a bit per country

@1 refunds are very, very rare-if it was for justaseat (4-5€) then forget it. But indeed-you should be able to get an altern. RES instead-except this may take so much time and effort and wait, that its in practice useless. 

Here in DE=Germany fairly often trains are cancelled alltogether-they ll notify you of that if you have left @mail-then you can claim a vouhcer (not money) for the value at counter-to use in bordbistro or so

@2-yes, in all such trains seats are marked (in fact anywhere in DE, AT etc.) for which sector they are REServed-blank if not. It may mean you have to change seats en-route for a long trip.

But it seems very strange to not be able to RES-its 5,70 for that and daft easy direct on bahn.com-choose seat only. As they are mailed it will also advise you if that train is late/cancelled or whatever they have managed to spoil the joy that day (I now sit in a german station using its free wifi)