1. Yes it's legal to own in the US, but you will not be able to use it in public.
2. Depends on too many factors to answer, "how long is this piece of string"

500mW is quite visible in fog, it will easily do things like house parties and maybe a bit larger.
3. Once again depends on too many variables, and you really should not go pointing laser projectors at crowds. It is highly frowned upon, and to do it safely and legally, you'd need to go through the variancing process, which is not a simple task at all, especially with cheap imported projectors.
If you want to use it in public, I'd look at buying from someone in the US like X-Laser. Their projectors are a bit more expensive, but they already have the variancing paperwork ready to go I believe.
If it's just to use at private parties etc, then what you do with it is purely your responsibility.