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All settlements must be placed at least two intersections away from any other settlement or city. After setup, a player can only place settlements on intersections that connect to his roads. If none of that player's roads touch the intersection he wishes to build on, he must first build roads to that intersection.
Under building roads (bottom of page 4) it says “A new road must always connect to 1 of your existing roads, settlements, or cities.” Under building settlements (top of page 5) it says “Each of your settlements must connect to at least 1 of your own roads.”
No. If you build a new road, it must always connect to one of your own roads, settlements, or cities. In the situation depicted above, the blue player would not be connecting his road piece to his own road but to the red player's settlement, which the rule prohibits.
No. You can build a settlement in the middle of your own road, as long as it is at least 2 corners away from any other settlement/city. You can place a settlement in any legal place, which includes in between existing road segments.
New settlements can be put on the “O” intersections, but not on the “#” intersections because the “#” intersections are all next to a settlement.
Each player has a supply of 15 roads, 5 settlements, and 4 cities. (Emphasis added.) and again later, under Settlements: Note: If you have built all 5 of your settlements, you must upgrade 1 of your settlements to a city before you can build another settlement.
The distance rule means two things. One: the maximum number of settlements around any particular hex is 3, as they'll all be two spaces away from each other. Two: Placing a second settlement opposite the first on a hex (three segments away) closes off that hex for further development.
If you build a settlement on his road, you disrupt it yes. You can reach it by road or ship. The vacant spot has no neighboring settlements or cities. (There must be at least one empty spot between two settlements/cities)

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