Passkey is some sort of specific unique key to a device allowing to use a pin on a device instead of the password. But which won’t work on another device.
Now I don’t know if that key can be stolen or not, or if it’s really more secure or not, as people have really unsecure pins.
It’s not quite unique to a specific device. You can store your private key in a password manager or something similar, and then access it from other devices
Depends on your personal choice. You can definitely limit them to a single, hardeneddevice if you want the highest level of security.
For most users and most situations, a synced solution will be preferable.