1) There's a magnet in the cover - when you slide the cover on the device senses the magent and goes into standby mode

2) No - the next best is "Lock keys & touchscreen" available via the power key menu

3) Doesn't sound right, it should just disable the screen (and possibly lock it if you've set that option) and awaken when you touch the screen/press a button. How long does it have to be idle before it powers down?