1. You can move the SIM and just sync via DM to change handhelds.
2. IIRC you can't perform a full backup on a 7290 and then perform a full restore on an 8700. However, a selective backup and restore should work. If you're syncing regularly, you shouldn't need to back up contacts, calendar, tasks, etc but it doesn't hurt to go ahead and do so.
3. You address book on the BB isn't stored on the SIM. Entries on your SIM will still remain on your SIM. Your contacts/address book should sync over but as I said, go ahead and add the address book to your selective backup (you can always choose not to restore the address book if it syncs over properly to the 8700). You shouldn't need to type in anything unless things go horribly wrong.