The "Te" isn't necessary here right?
it isn't, usually you would only include 'te' if you wanted to emphasise the object, for example in the following conversation:
-Hogy vagy, Kati? (How are you Kate?)
-Jól, köszönöm. (Fine, thanks.)
-És te hogy vagy, Péter? (And how are YOU, Peter?)
You are perfectly right.
No, you can drop it :)
No, the two sentences are not really equal, I would translate "Te hogy vagy, Péter?" such as "As for you, Péter, how are you?".
What is Te here standing for ?
"Te" is the familiar form of "you". It is not necessary here, since it is understood.
So, it is not necessary here, but to get the question correct, we must include it, remembering of course that we have never seen this word up to this point.