I'd contact Shimano asap and see what they are willing to do for you.
That depends on how you used it. The pawl and worm gear are open to the elements and easily pick up dirt and dust. Its not uncommon for pawls to wear out because of that, and the worm gear as well. I used to have a reel repair business and have replaced many. Baitcasters don't like sand.
I'd totally agree with this. Sand, dirt, salt, any kind of grit are "4377" on levelwinds. That said I own a number of ABU 5/6000 series reels with the "non-disengaging" levelwind. I keep them clean and oiled, fish 'em really hard for muskies and replace a pawl only once in a while, usually 5-6 years. I do teardowns and cleaning twice a season and keep 'em well oiled in between. I prefer my own lube mix of Break Free and ATF, 50/50. Not a particularly long lasting oil, but pretty fast and not prone to gum or keep grit in the mix./m