1. All characters. User-made sims, townies, NPCs, everyone. (Townies and NPCs will be regenerated as needed, so your neighbourhood will remain fully functional)
2. See above -- all sims will be deleted, friends or not. If by "I" you mean a sim you made, that will be gone too.
3. I haven't looked into this, but I would assume that inactive characters get deleted as well. I think you can check this by looking at the characters folder under windows (it should be empty) ... however I'm not sure where exactly those files are stored, maybe somebody else will know more.