1 - "The pump turns on and off less often for the same amount of water usage"
Yes, and that is a good thing as cycling is what destroys pumps, tanks, and controls.
2 - "When the pump does run, it runs a higher efficiency; which in turn saves electricity."
Actually no, you may save a couple a bucks a month on electricity by letting it cycle on and off into a pressure tank. Your pump system just won't last as long and you won't have constant pressure.
3 -"The pressure in the system remains the same while water is running."
Yes, you will see constant pressure instead of always varying pressure for the shower and sprinklers.
At the same time I wonder about the following potential problems:
1 –"Let's say I was targeting 60 psi for my pressure setting. How do I know if my existing pump is capable of that pressure?" You can close a ball valve before a pressure gauge and measure it. Or you can tell with the performance curve for the pump by subtracting the water level in the well.
2 – "Let's say my pump is capable of producing 70psi yet I am reducing it to 60 psi. What happens if I open up enough faucets in the house to exceed that 60 psi?" When you open up enough faucets that the pump can no longer deliver 60 PSI, the CSV turns into a piece of pipe and you will get whatever the pump can produce.
3 – Is there any disadvantage of having the pump run longer and less often as compared to shorter and more often?
4 – "Is there any advantage or disadvantage to installing a larger pressure tank in addition to the CPV system?" The advantage is that you still have constant pressure and no cycling when you are using the water for long periods of time. Another advantage is the pump does not have to come on as many times per day for intermittent water uses like flushing toilets. The disadvantage is the cost and room for the big tank, and that you will have to wait for the tank to empty and the pump to start, before you will have constant pressure. The CSV even with a small tank saves so many cycles per day on long term water uses like sprinklers, that the few extra cycles from toilets flushing don't amount to much. Most people like the small tank better because you are already at constant pressure before you get the temp adjusted in the shower.
The constant pressure will also make your washing machines fill faster, and eliminates water hammer from pump starts, which is good for the plumbing. You will like the constant pressure in the house. Small tank or large, the CSV will make the pump system last longer, which saves even more money.