I've taken focused game courses for 1 year at my previous college and just started programming again in my new semester here and took a game history class back in the spring. I'm not sure how accurately I can answer your questions, but I'll give it a go. But I should let you know right now that I have not built my skills enough to begin a game, nor do I have professional experience, so this is just words from a student. Also, I trained mainly in the field of programming with only minor student experience in design, so...
1) Folks still have it in their minds that games build themselves, even newer students. Most orientations tend to over-exaggerate what actually is in store to make it seem more appealing than it is. The work is pretty mundane most of the time and it takes a large amount of time to actually get anything done, all before you start using more sophisticated tools. I'm having a bit of trouble answering the first question, so if you could specify it a bit more, I could probably offer a better answer for you there. Sorry.
2) For the most part, the classes are very focused. Actually, they're incredibly intensive most of the time. In design, it can be pretty simple to learn, but most of it is "learn by doing" and requires a large team dynamic. Programming is more solo work, and thus becomes a great pain in the ass if you have little knowledge concerning whatever programming language you're using. Sometimes it seems that most of the classes force you to learn on your own time since most of the material they cover during a class lecture is very fast paced. If you're learning programming without experience, this can be hell since they throw A LOT of different terms at you with the expectation that you already know what's being discussed. Be prepared for that.
3) Most are, especially the design based professors. They usually begin a semester by explaining what type of projects they've worked on and how long they've been in the industry. Programming instructors are somewhat different and act a bit more technical. Sometimes they have no gaming experience, which really doesn't matter all to much in programming, but still share where they gathered experience. You can usually tell right off the bat if they're a gamer or not. It can be helpful, especially if they can hint and reference more popular game mechanics into a project. But then again, they can be tough to work with. I've met quite a few instructors who force you to teach yourself or scoff at your programming techniques.
4) Yes, you learn a lot on the side of legality and business. Most of it you may already know before taking classes, like the relationship between publishers and developers. Others include copyrighting and plagiarism, especially on the coding side of things. Other stuff like licensing and marketing are also taught, mostly off hand. These aren't main focuses of most courses, so just be aware of that. Most of the time they only teach you about team and time management and how employers might find you and your work and your expected time of employment. Programmers, while paid a lot, are the most expendable people in a development team, as said from multiple sources...lucky me.
Sorry if my writing isn't all too cohesive right now. That's all I got at the moment, so hopefully that helps. If not, sorry that I butchered your thread. If you got any other questions, I'd like to help, but I can't guarantee a great answer.