No. The card requires the players chosen to decide whether or not to assist when there is no Loot being offered. NPC players can't really do that, because there is no one to make the decision for them. Therefore, they can't be one of the two players chosen to assist.
As a rule of thumb, if an effect that can target a player requires any sort of decision on the part of the targeted player, then that effect can't target an NPC. Likewise, anything that moves a player, causes a player to do something with a shtick, Wounds a player, etc., cannot target an NPC, because NPC's don't do any of those things.
If you mean when you are the battling player, yes. (The fact that you can be one of the two players offering assistance is spelled out on the card.)
They are not specifically spelled out, but are inferred from the "Removing Traps from the Game" heading on page 26. It will be added to the errata at some point.
At the end of the turn during which the Battle Cards ran out, you reshuffle the discard pile. Note that this means that if you are in the middle of playing a big battle (like Xykon), every player may run out of Battle Cards before the Battle Size is reached. If that happens, then that's the end of adding cards to that battle, and the current player faces it as-is. In any case, don't reshuffle until the end of that turn.
This will also be added to the errata at some point.
You played it correctly, you may heal wounds suffered while resting.
No.