When you brought up villains being portrayed as heroes, my mind immediately went to Loki. Characters of his type (not villains, per se, but incredibly adaptable trolls) would probably be amused to no end by a lot of badfic. If they were more or less in their right mind they would probably try to take advantage of the situation.

Not that I imagine Loki particularly would have many opportunities to do this, because he tends to be one of the most butchered characters I've seen in MCU fanfic. I think his opinion of his portrayals in fanfic would range from amusement to anger, depending on the particular portrayal.

Loki doesn't think of himself as a villain, and neither do a lot of fanfic writers. Fundamentally we see agreement, but the problem arises when you look at the way the fanwriters tend to defend him, which more often than not is portraying him as weak, or more victimized than he was in canon. I don't think Loki would appreciate that.

And I also think he wouldn't much like any fanfic that had him too far out of character. Fundamentally Loki and most other villains like who they are. Seeing someone twist their personality to the point most badfics go to would probably not make them happy.

Besides, I've seen a fair amount of goodfic that's managed to portray villains as good guys to at least some extent. If it can be done well, there's no need for them to approve of it being done badly.

TL;DR: Using Loki as an example, I think that it's unlikely that badfic interpretations of villains as good guys would please the villains much, since it usually involves some warping of character. Also I've seen that done well, so there's no real use to doing it badly.

1. It's possible for a canon character to hold any opinion they might canonically hold. Any canon character who would agree that mind-controlling people against their will in order to make them more like what you want them to be might think of a 'Sue as working toward their own ends. However, such characters almost always don't want their own minds tampered with; so once the 'Sue pulls them out of character, they tend to be pretty annoyed once they come to their senses. Of course, they would need to be aware of the PPC, either temporarily or permanently, in order to have any opinion at all.
   
   Since badfic usually ruins characterization even when it attempts to perfect a species, most mind-controlling canon villains would actually see the 'Sue's efforts as an amateur, horribly executed attempt at doing what they've been trying to do.
   
   2. Imagine covering up a photograph, and poking a hole in the cover. Anyone trying to recreate the photograph from just what they can see through the hole can do whatever they want with the covered-up parts, but their guess needs to be consistent with what's visible.
   
   Depending on how complex a character is, they may be a Generic, a bit, a minor character or a major character. If they're in-character, whatever you can see of them will be consistent with what you saw about them in canon--even if canon doesn't explicitly state those parts.
   
   In the PPC, many agents started out as bit characters or minor characters whose personalities were not completely determined when they joined the PPC. Gaining a personality can be part of these agents' stories. I've never written any missions, but I did create an agent, Jane Doe. She started out with practically no personality except for "Generic Tolkien Dwarf", and over her introduction gained only a love for coffee and a tendency to pay attention to details. Luckily, Jane Doe comes from a strong canon with a well-defined species, so she has a lot to build from.
   
   Bit characters and minor characters gain their three-dimensionality from the canon they come from. If the canon is strong, they're fully-realized people who simply aren't very visible. If the canon is weak--as a badfic storyline is--they can even be completely non-sentient, unable to do anything but stand there unless the fic tells them to do something.
   
   What your agent does with them depends on how much they take from the host canon and how much they take from the fanfic.
   
   Bits and minor characters relatively unaffected by the fanfic can be allowed to assimilate into the canon, optionally after some kind of memory modification, and live as fully-realized people.
   
   Bits and minor characters strongly associated to the fanfic but without any real characterization will generally poof out of existence along with the non-canon furniture when the biggest canon breaks are fixed.
   
   Minor characters strongly associated with the fanfic but with too much characterization to disappear or assimilate on their own have to be removed. Options include assassination, relocation to a more appropriate canon, or recruitment.

If a villain was often portrayed as a hero, that would be an example of the Aura of Smooth affecting them, and people generally don't like being mind controlled.

As for the "perfect race" question, I think a non-'suefluenced character could tell something was wrong with the result, as 'sues tend to stand out.