1) They will assess the failure, maybe change some elements minimally, and launch again. It does not look like they'll go out of business anytime soon, and that would be the only reason not to try it again and again.

2) The legs have nothing to do with it, based on what we know (and it's very unlikely, too). Manned flight certification could be impacted, e.g. assessment period will be extended, but insignificantly (assuming they find a cause and the next launches go well). USAF certification will probably not be impacted since they reached the minimum amount of successful flights (assuming there are no other rules like "no launch failure in last X flights").

3) No, the rocket was probably terminated, i.e. explosives fired to break up the malfunctioning rocket. So you probably saw the debris.