Quick answer.
Dept of Homeland Security will protect you.
If there is any "real" danger, it's from kids and brats that wanna go exploring on your computers, or borrow your internet connection. This is where it's good to know your neighbors.
Think of it as a sport. There doesn't really need to be an objective.
Yes. No radio signal, no access.
Yes, but they don't do much with the information, especially if the access point is secured.
Actually, it's more prevalent in the suburban areas because kids have more time to attack your system. Much of the hacking relys on capturing a substantial amount of encrypted traffic and extracting the encryption key. Mobile users in urban areas don't normally have the luxury of a fixed location in which they can erect large antennas and spend days capturing and crunching data. Suburban kids do have that.
WEP 128 is usually sufficient to slow anyone down. WPA is much better. Make it a habit of changing your access point password and WEP/WPA keys at regular intervals.