To your question #1, I simply hoist the upper yard straight up the mast with no parrel.  I had imagined that having the halyard double as parrel like that might be a problem sometimes, which your experience sorta confirms in my mind.  With full sail, I find that the yard doesn't kite away from the mast excessively if the downhaul isn't too slack. With the first reef it does a bit, and if I ever sailed for more than the five minutes I tried the second reef one time before I shook it out, I might want a short line rigged loosely to act as a parrel.  Whatever your do as far as a parrel for the upper yard, you need to be able to cast it off quickly if you are dousing sail in a sudden squall in order to be able to muzzle the sail quickly.

To your #2, your cleat may be a little low, or you may be hoisting the sail too high (it wants a bit of slack at the top so as not to bind when the sheet is eased out), or both.  If you have sufficient tension on the downhaul, the lower yard (some call it a boom) shouldn't kite away from the mast much.  I rigged a poor man's two part purchase for my downhaul by passing the line through a small stainless steel thimble seized into a loop on the underside of the lower yard with the end taken down through the middle of the cleat and held with a stopper knot.  It takes a lot of downhaul tension to get a balanced lug to set correctly, moreso in heavier wind.  Things will also stretch a bit after sailing for a while in a good breeze, and I find I will usually need to tweak this a bit once or twice during the course of an afternoon's sail.

To your #3, if your problem is only on port tack, see my comments about downhaul tension... maybe, hard to say.  Being a shorter rig, tacking in light wind, especially if it's a little squirrelly, is not going to be the strong suit of a small balanced lug sail on a light boat.  I do find that I need to make the boat heel a bit to have any weather helm when the wind is light, and I may need to bear off a bit to get more way on before starting a tack, catching a little puff if I can.  I have been known just to wear ship instead of tacking, knowing that she won't have enough way on to carry through.  I also find that too much helm renders the rudder useless at low speed if I overdo it.  That's all about the rudder and boat speed, not the sail.

However, that shouldn't work much differently on one tack vs. the other.  I suspect having the yards and sail lying against the mast on starboard tack may be flattening the sail to help you out, whereas on port tack, things may be looking a bit baggy.  Did I mention downhaul tension?  <;-)

If I'm having trouble making much more than 1 knot when the wind gets down to Iffy, Whiffy, and Sniffy, I generally douse the sail and row, which was the whole point of going with the lug in the first place, as you've noted. Okay, right, sometimes I just want to make it back to the dock without touching the oars as a "goal for the day" when the wind hasn't otherwise resulted in a rewarding sail just to boost my lagging spirits.  On light wind days, I often go for a long row with the rig left ashore so a brief puff ow wind won't tempt me to set sail just as the wind dies off again.  She's a delightful little rowboat and a joy to row ... except maybe when you are rowing into a 50 mph breeze on the edge of a surprise thundersquall with the mast still up and a passenger forward, and you were reluctant to engage in the necessary dance steps to rearrange all that with the wind trying to blow you off to Oz.  It actually worked okay, though.  But, I digress....

To return to your questions, I do wonder about the mast location....  I believe the PMD lug rig is built with a different mast step, located farther aft, is it not?  If that is so, and you are stepping the lug mast in the gunter rig's mast step, that might explain some lee helm, especially close hauled in light air.  You might be able to compensate for this by moving the point of halyard and downhaul attachments forward a bit, hard to say without trying it.  This would necessarily require even more tension on the downhaul to compensate.  The upper yard is a third class lever (well, so is the lower yard, now that I think on it), and moving the halyard forward (the force point of the lever, the fulcrum being the sail's luff) will make for less effective leverage.

When we set up our PMD lug, I didn't drill any holes or attach any padeyes.  I wanted to be able to adjust things once I had some experience with it, so halyard, downhaul, and sheet are all attached with loops of 1/8" low stretch line (it took me a while to find something "hairy" enough to hold knots well) lashed tightly around the spars.  I have, indeed, adjusted the location of these over time, and I might still have a tweak or two I'd like to try if the I can get more time out sailing in decent wind.  Seems the decent wind likes to come on the days I don't have time so far this season here in Central Ohio, not to complain.  This lovely little boat is a blessing from the hand of the Lord, and I give thanks for her every time I look at her.  <;-)  But, again, I digress....

To your #4, I find my ears work pretty well for a wind indicator, but I also added a red streamer at the peak, purchased from CLC:

https://clcboats.com/shop/products/boat-gear/sailing-gear-accessories/pennant.html

...attached with a short bit of line to make it less likely to foul during a  gybe.  It helps a lot, especially if my ears and neck are well covered against blazing sunlight.

Getting a balanced lug to set well is a bit tricky, and not something with which most folks have any experience.  I sure didn't, but I'd read Phil Bolger's comments about the rig, and was prepared to experiment.  Taut outhauls and strong downhauls, in general, are the answer.  If it isn't working right, you end up with some degree of bagginess, which will kill the performance, especially upwind.

Which is, any bozo in a bathtub with bedsheets on broomsticks can sail downwind.  It's upwind that separates the spars from the broomsticks, the sails from the bedsheets, the sailboats from the bathtubs, and the sailors from the bozos.  Okay, hang on...I did not just call you a bozo there! You are obviously not, or you wouldn't be asking these questions!

I hope this helps some.  The only dumb questions are the ones you don't ask.

   Thanks for the thorough and entertaining reply! Very helpful. I look forward to getting more experience with this rig as I really liked how it handled when the wind was good. My daughter said it looks like a pirate ship, which I take as a compliment. I think every other sailboat on the lake is a Laser, but what they have in speed, I have in looks. There is something about sailing in a nice looking boat (props more to the design than my boat building capabilities ).

   On #3,  I found  that, with some more sailing with the rig, that I'm probably in irons as I'm trying to head too far upwind. I found that letting the sail out a bit (which was counterintuitive to me) brings back helm control and ends the stall. 
I have come to like this rig a lot. Had a good sail today in very variable winds and she handled very well. She tore along nicely when the wind got up. Still have a lot to learn, but that's half the fun. 

   Slash2...

Elsewhere on the forum you'll find some good discussions on how to get a lug rigged, lightweight boat through a tack in light air. It isn't easy and there are many little techniques that, when properly combined, tested and learned for a given boat should be helpful.

By finding improvement in bearing off a bit and easing the sheet, you've hit upon one of them through trial and error.  Good for you.  Always important to keep the boat moving well enough to get some response out of the rudder, whether sailing on any given course or trying to come about.  As soon as you can't steer, you are basically just a piece of (frustrated) flotsam out there.

To help with a little nomenclature - I think the word you want to substitute for your use of "in irons" is "pinching."  Pinching refers to trying to sail at an angle too close to the wind, where even a fully trimmed-in sail is beginning to stall and thus there is a loss of boat speed.  When sailing upwind, what you want to maximize is Velocity Made Good (VMG) to windward. There will always be a certain angle of sail (selected course) that maximizes VMG, dependent upon the boat, sail shape, sail trim, wind speed and sea state/direction. If you don't have a million dollars in tech like the America's Cup boats to compute/measure/display this for you, the way you find the best VMG is through feel, and developing that feel takes a lot of experience.  Sounds like you are developing that. 

"In irons" refers to a failed/aborted tacking maneuver in which almost all headway, and thus steering control, is lost when trying to come about through the eye of the wind. Once in irons, the most common recovery method is to allow the wind to give the boat some sternway (moving backwards), then use the rudder to cause the boat's bow to fall off the wind, then trim in and get going forward again. Depending upon your heading relative to the wind when you are ready to put the rudder over to fall off, you may choose to be on your new tack, or (more commonly) you'll end up back on your old tack and need to come about again once you're up to speed. One very helpfull trick that is very easy to accomplish with the lug rig in these small boat is to push the boom up into the wind to help develop that sternway, and as you begin to move astern, then put the TILLER over to the SAME side of the boom. This can pretty quickly get you nearly abeam to the wind. When ready to start trying to move forward, gradually but fairly rapidly sheet in on the main, and WAIT a few seconds until you just start moving forwards to gradually but fairly rapidly shift your tiller to the opposite side of the boat. As you pick up speed steer onto your newly selected course and trim appropriately. Describing is always harder than showing when trying to teach sailing techniques.  https://www.youtube.com/watch?v=S9tdCOD62_o

Good luck out there on the water. Bubblehead.

Right, if you are more or less head to wind and losing the race with the bubbles and other flotsam, reverse the helm, back the sail, and she should fall off on the new tack...hopefully.  <;-)  If it's windy and rough, mind you don't get knocked over while the boat is sidewise on the new tack before she is able to gather way.

   Thanks for the correction. As I was not trying to tack, "pinching" is the right term, which was new to me. I'm a little bit smarter now (well, less dumb). 
Based on my limited experience with the lug and Gunter rigs, I think I'd recommend the lug. The Gunter is a beautiful setup, but I'm not sure the complexity is worth the slightly better performance. I have to sail in and out of a 200m wide cove where the winds is usually blowing along the length of it. I don't think the Gunter rig was much better at tacking out of the cove. Well, maybe I should say "I" wasnt much better with the Gunter rig.