The -ae ending here is the locative case for first declensions. The locative is only really used for cities (such as 'in Boston' -> Bostoniae, 'in New York' -> Novi Eboraci, 'in Rome' -> Romae), towns, small islands (usually have only one city or town on them), and a handful of other nouns (like domus as domi, pretty sure the only one that is used in this course as of this post).
in is used for all other nouns that do not fit into those groups (in America, in foro, in villa, in Italia, etc.).
Technically yes, but naturally no. Because of the particle endings it will make sense whichever way you write it, but naturally it would not be said that way. With some languages your adjectives & other descriptive words come after whatever they are describing (like French), and for Latin this also includes the pronouns.
Familia refers more to the household or family as a whole than just relatives (in ancient times a familia may have included people who were not relatives but apart of the household).
Duolingo uses familiares when talking about relatives, but I suspect some Latinists may not like that usage.