It is bad since you lose 50% of the vertical resolution. That can not be compensated. If you require progressive, shoot progressive. If you haven’t shot progressive and are not delivering on celluloid, forget about progressive.
Knowing Matrox and their track record, if you upgrade to CS3, you probably need to wait for Matrox to come out with the RT.X3, since likely they don’t upgrade drivers for the RT.X2 and CS3 combo.
No since capturing is just a digital data transfer and you can not modify the data during capture. You have to use your deck to modify audio levels before converting analog signals to digital.