Not toxic. I grow and maintain a piece in my DT. When it gets too big I chop it an throw it in the blender with the rest of my seafood mix for fish food.
I have no idea. Perhaps it's an acquired taste?
I do know that the more often caulerpa is chewed on the more Caulerpin it produces. Some species produce very little (C. serrulata) some produce a lot (C. taxifolia).