Yes if you want to continue to receive updates, as MS will not be supporting updates with SHA-1 in few months time.
Yes, absolutely. Without full SHA2 codesigning support, you won't get further updates (as the signature checks will fail).
Updates KB4493472 to Windows 7 and KB4493446 to Windows 8.1 cause system freezing shortly after startup. This is due to some problem with wifi network adapters. Probably all network cards: Intel, Atheros, Broadcom. It takes about 2 minutes on SSD drives.