1.) I always keep any booster at max and reduce the gain on all my other amps except the GP and the clone. As an example I put my Peavey 5150IIs gain at 5-6 (1-2 o'clock), JCM 2000 at about the same and my ENGL preamps at 4-5 (11-12 o'clock), more than enough on high gain amps with the booster. GP-1000 isn't a high gain amp, the clone is kind of, but only when maxed.
2.) Good Idea, but use as light sandpaper as possible, might even be good to use wet sandpaper to get it as silky smooth as possible. I haven't done it on any of my guitars, but my ESP Alexi STD needs it as it's back is getting kind of sticky from the gloss finish.
I wouldn't sand a painted one to the bare though, would look pretty ugly with painting sticking out here and there (if you don't do it 100% and sand the whole neck up to the binding of the fretboard), if you really need to sand it, wet sand it slightly with super light sandpaper so that the paint don't wear off or oil it with oil based for guitar neck, should be available at your local guitar shop, at least all I've seen has stacked up with all kinds of oils.