Decoherence doesn't really solve these issues. It gives you an approximately diagonal density matrix for the macroscopic degrees of freedom, but:
(a) Not exactly diagonal
(b) There isn't a unique decomposition of the macroscopic density matrix even after decoherence thus it cannot be taken as simply ignorance of some set of macrostates.
You need something stronger, namely superselection or irreversibility.
It's not unitary evolution breaking down, just that the Born rule isn't a consequence of unitary evolution. They're separate independent hypotheses. In most derivations of QM from an axiomatic basis they're consequences of separate combinations of axioms.
No it can't. There have been many attempts and they don't work. The Born rule is independent of unitary evolution. The closest one can get is to declare that the quantum state is fundamentally a statistical object (i.e. the only information in it is observation probabilities) and then with certain assumptions about the size of the state space you can show that the Born rule is the only possible rule for connecting the state to statistics consistent with the unitary dynamics.
So under the assumption that the state encodes probabilities, state space assumptions and consistency with unitary evolution you get the Born rule. However this is not the same as the Born rule arising dynamically from unitary evolution alone.
Well in the most common family of interpretations "collapse" isn't an actual physical process, just Bayesian updating. So you wouldn't expect to find physical evidence of it in that sense.
It's true that from the perspective of an external superobserver the quantum state evolves to contain terms for each observer observation state. However since all interference observables turn out to be non-physical for macroscopic systems we get a superselection rule and so the probabilities for different macrostates are classical probabilities and thus reflect simple ignorance of the observer's post measurement state.
There's very little motivation for reading the quantum state "ontically" in the way you are doing.
You need something stronger, namely superselection or irreversibility.