1. Kinda. I mean, the lower the firmwares, the better chance of it being cracked, i.e. less measures have been taken by sony to patch up things. I personally would probably update though cause it might be a while til something comes along and people are probably trying to work on the latest firmware they can to have the most use for people.
2. No dongle is needed to play backups from external or internal drive on 3.55. Is that what you're asking?
Never there but always going back