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The code is open-source and available on GitHub. If you don't trust the hosted version, you can run it locally too, with the instructions provided on GitHub. For safety reasons, you have to run it offline, if you want to search using a mnemonic phrase.
Hierarchical deterministic wallets like a Ledger device, Trezor device and mnemonic phrase are able to generate many different addresses from a single seed by using derivation paths. FindETH will search through the most common derivation paths (currently 31), offered by some of the popular wallets.
Partially. You can search for addresses offline, but in order to search for Ether or tokens, an internet connection is required in order to fetch the balances from the Ethereum network. Instructions on running it locally can be found on GitHub.
No. Private keys and key store files aren't hierarchical deterministic wallets; they generate a single address. You cannot use those to search for your Ether, address or tokens with FindETH.