To answer your questions, in order:
Yes, if you really lean into it.
Yeah, that's how you inflict poison. Some Yokai abilities can do it too, and you can also get some poison smoke bombs and poison arrows in the Ninjutsu tree.
The damage itself can't be enhanced as far as I know, but you can enhance it's build up with gear stats. Additionally, you can get gear stats that increase your melee damage against posioned targets. I highly recommend this, as it's were you can get a lot of extra damage.
Yes, as poison build up decays quickly if you don't complete it. I find that most enemies only require 1 or 2 hits to poison them, but I have a fair bit of poison build up stats so you may need more. Be careful though, if enemies block the shurikan, they will not be poisoned.
Additional tip: Use the Gallent Broth (weapon buff) after the target is already poisoned. I find the Broth to be inadequate on it's own, however, hitting an already poisoned target with more poison damage will extend the duration. This makes the Broth perfect to top off the poison timer while you pummel the target with your bonus melee damage. Granted, the target would have to have a ton of health to make this combo worth it, so you should only really use it on bosses and the like.
Slayer of Demons,Inquisitor,Ylissean Tactician,Kindred Hunter,Gray Warden,Dark Lord,Good Hunter,Chosen Undead,Nerevarine,Exile,Mugunghwa Investigator,Tremere Anarch,ESPer,Squad 7 Hero,Nohrian Prince,Arisen,God Eater,YoRHa Android,Tenno,Hope's Peak Dropout