Before I go into your points, we need to understand how the monetary system in the US/CS worked. Unlike today, the US was using a bimetallic standard, mainly gold and silver, to help with exchange. After 1870, the US became part of the Gold Standard - set up to facilitate international trade. Nowadays, we use a fiat currency system, where essentially the bills are not worth anything other than what the Federal Reserve says it is worth. But before the US was removed from the Gold standard in 1971, usually every dollar had a ratio of gold and silver that the bearer of that bill could withdraw from a bank, often in the form of coins. During times of trouble, valuables are hoarded, often causing coin shortages or other economic issues I won't dive into here. If you look at older notes, and especially on notes of this era, the language "payable to the bearer in silver [or gold]" appears on the bills. The value is in the metal of the coin, not necessarily the bill. The bill is valuable because you have the ability to go to the bank and get its value in valuable gold or silver. But, since these are troubling times, everyone has run to the bank to exchange their bills for coins. No coins = worthless piece of paper.

Now, lets dig into legal tender - what is is legal to make payments with? Legal tender is something that must be accepted as a payment, by law. The government decides this and it can be changed. This is important - paper money was not legal tender at this point in US history, only coins issued by the US government. Bills were issued by banks, not the government, so the government had no obligation to accept these notes. The bills generally need to be backed by hard assets, such as gold or silver. If the bank is not good for the payment, the bill is worthless. To put it more generally, at this time period, the bills are more of an obligation to honor a payment in gold or silver to the holder, as long as the bank's store of coins hold out.

At the outbreak of the Civil war, both North and South issued banknotes. US issued $50 million in legal-tender $1 Greenbacks payable to the bearer on demand in gold, while the confederates issued $1,000,000 in "Greyback" notes with one important difference: the payments were not promised or backed by hard assets. Rather, they promised a payment from the Confederate Government after the war. The Confederates kept issuing these notes as the war progressed to cover their debts, backed only by a promise. $867 million worth of bills were printed in large denominations.

Now, money is only worth what people believe it is worth. High supply means low demand. The confederates had to make more and more currency and were fighting a losing war. Plus, public opinion mattered - if people believed that currency could not be redeemed, it went down in value. Since the Confederate notes were only backed by a promise after the war, and the confederacy began to lose, their currency value dropped. Gettysburg alone dropped the value of the Greyback by 20%. On top of that, later notes were to be paid out after a treaty was signed, and there is no way the Confederate government would survive long enough to pay out on all of the money it issued, even if the US allowed it to continue as an independent nation. Early in the war the Confederate notes were more valuable - the CSA dollar was worth .90c of gold in Dec 1861and by 1863, only 6 cents, and lower still as the war progressed.

You might ask, why didn't they just strike gold and silver coins? Simply, they could not afford to as any valuable metal was shipped to Europe to pay for war goods. They just could not support any significant economy and fight a war at the same time.

Let's get to your questions:

1. Collector value for Confederate noted depend on supply and demand. There is a high supply of these notes as the war goes on, but the earlier notes are more collectible and rare. These early are worth thousands in good condition. In circulated, maybe a few hundred. The later notes are generally worth less than $50 each depending on denomination and condition.
2. The first Confederate notes were issued before the civil war, so they were definitely used. As more and more bills were made, prices went up to accommodate. A dollar of goods isn't really worth a dollar anymore when everyone has $1000 bills in their pocket. We have the journal of Dolly Sumner Lunt Burge that discussed prices of the day.
3. Personally, I don't believe I can answer that question. They did make millions of dollars in currency, but for someone to hoard a million dollars worth during a war is counter-intuitive. People want their value in hard assets, for the south, that was slaves and cotton. I would be spending it as soon as I had it, or spending it on a way to get out of the CSA, but we are looking back on the situation. I believe it would be possible for someone wealthy to amass that much money in cash, but realistically, they would want to spend it and have real assets instead of money.

Edits for clarity.

I don't have anything regarding #1 and #3, but on point #2 you may find these interesting:

During the Civil War, were Confederate dollars and normal U.S. dollars accepted in both the North and South? written by u/Erusian discusses a bit about the Confederate currency during its heyday.

Additionally, What happened to US currency in the Confederate states? written by u/Prosodism

There are several sites to buy Confederate Notes as they are very collectible. I just looked up some random values and found an uncirculated $.50 note from 1864 going for $45. There was also a XF+ $50 note from 1861 going for $2975 and a $5 note for $325. Prices are all over the place, but even the cheapest denominations are worth many times their original face value. Ironically, while individual bills are worth something today, especially the good grades, flooding the collectors market with that many bills would vastly devalue the currency making it effectively worthless.

CSA notes were printed from 1861-84. Most were hand signed and hand cut so a "real" note tends to have ragged and uneven edges. Even at printing they were pretty much worthless though. Most Confederacy notes, bonds, etc, were pretty much promissory notes and weren't backed by anything tangible. They only became worth less as the war went on and no one outside of the Confederacy would have accepted them. I remember reading about one British merchant ship Captain taking Confederate currency early in the war only to find out it was worthless when he got home and going bankrupt because of it. On top of that, the Union printed their own fake CSA notes to purposely devalue the currency more. By the end of the war they were completely worthless and a lot of them probably were destroyed for their use as paper.

In addition to scarcity, what makes them collectible today is that unlike US Currency at the same time there was a lot of variety in bills. In 1861 they were mostly printed and issued by the central Government and distributed out. Even then there was not consistency in the look of bills. George Washington and Jefferson Davis both appeared on their own $50 bill for instance. By 1864 there were dozens of designs with slaves working in the fields, trains, Lady Liberty, the Nashville Capital building, Senators, etc.

As early as 1862 they were issued and printed by Divisional Army Quartermasters instead for from a central location. Each came up with their own designs based on what they could physically print with the equipment and ink that they had available. Being able to print money in the field allowed CSA commanders to "pay" for goods that the Army seized as supplies. But even in 62, all but the most patriotic civilians disdained the money. There are more than a few diary entries complaining about being forced to accept it as soldiers led away the family cow. And from the soldiers side plenty of writing about feeling bad that they're taking goods without really paying for it outside of the worthless currency.

So yes, it would have been possible for someone to hoard a million dollars in Confederate money. But it would have been easier for them just print up a million dollars themselves if they had the authority to do so.