(Not a lawyer)
1. Yes. As per the respective licenses, if you modify Varien-made core files, aside from the template, you have to share these by making them publicly downloadable. If you extend without modifying the core files, through real Modules with classes that extend instead of overwrite core classes, you don’t have to share this code.
2. See 1. AFAIK you can charge for this but the owner becomes the full rights owner and is then allowed to distribute as he/she pleases
3. Yes, charging has never been the issue with FOSS software.
4. Not on self-made themes but all credits have to be kept in the source files.
You really need to spend a day or two studying the AFL and OSL, then get a lawyer on any queries that remain as Varien won’t give you legal advice either.
In short, yes your client can take Magento and build something on top and charge for the lot. They just can’t claim they own the original Magento files. And any doftware that extends OSL software, becomes OSL itself so they carefully need to think how their code interacts with the core code.