1) If the system is set up like the senate represent the interests of planets, as well as companies (you know, a bunch of weird aliens launch a company on some empty planet or whatever, and become a separate party), I could go with that. Not that important, but just kinda thrown in there, and another maybe interesting idea wasted.
2) Well, for the record, the movie doesn't say anywhere she's 14 - I think the novelization does, and dunno whoever else. Keira Knightley was 13 or something during filming, but under that make-up, you couldn't tell. Portman easily looked like she could be 20+.
At any rate, they probably wanted some weird planet harking to their old traditions (accentuated by all that make-up and formalspeak), so yea, the "elected" "Queens". As it stands, there's no substance to that idea so it's entirely disposable.
The obvious answer is that because Leia was a princess. Why was she a princess? Under an... Empire? ... Um, whatever. Pretty sure they were making a naive space fairtytale at that point, so not much thought went into that, either. It worked there, though... in a campy kinda way.
3) Either that, or Qui-Gon thought they'd just crap in their pants and give in without any actual threats.
At any point, yea, completely stupid - the opening scene is additionally hampered by the fact that we don't know how the Republic views the blockade. Valorum... or the Jedi... KNOW it's bad and illegal... or, um, they don't want the tax laws to change? But in public, Valorum is powerless so he "officially" doesn't believe the testimonies. Again, no clue about anything. When exposition is so damn paperthin, dropping further unclarities on top isn't the best idea.
Just stupid.