>>1. What is the true cost of a cheap improperly equipped PSK? <<

An attempt at a trick question? I'm guessing that you're going for an answer with the word "death" in it... but I'm not much into rhetorical exercises.

There are expensive "improperly equipped" PSKs as well as "cheap" ones, and as many folks here know, a little personal attention can make up for a lot of money in creating a "properly equipped" PSK, and a little experience can be worth quite a bit of equipment.

I'm a "knife nut" myself, but I'd bet on a seasoned woods-rat with an Opinel over a newbie with a your choice of $300 survival knives any day.