As to problem the first, I wouldn't suspect an upramp to depressurize the water. I always attributed the depressurization to the water squeezing between the little crack in a diagonal space.
Closing vents at the bottom of the pump stack, just before the vent uptake, made it pump full pressure at the top, but I don't see why that should be. The only place there's a diagonal is right at the bottom pump's uptake, after the vent. It's still all pressurized water going down the stack vents and coming from each level of the pump.
Illustration:
|~|
|~v~|~~~|
|~|-F---|
|~~~|~~~|
|~|-F---|
|~|-F---|
|~~~|~~~|
|~|-F---|
|~v~|~~~|
|~|
The water squeezed horizontally into the Fortifications is where the pump uptakes are, and this keeps debris out from under the waterwheels, so I guess it would prevent swimmers, too. There's another experiment for you.
The vents are closed with drawbridges that raise to the left, so when open both vents and pump uptake get water squeezed diagonally, and this controls the flooding effectively. The vent merges with the vent at the top of the pump stack, so two different pressure levels mingle at their lowest points. Perhaps because the bottom vent enters the channel first, it cancels the pressure at the top level? With that closed, only the top level's pressure enters the reservoir, and when it fills to the top pump's level, water rises out of the u-bend at the end.
For problem 2, "pressurized" water teleports, and teleporting water causes no flow to power your water wheels. Add a diagonal passage to disable "pressure" teleportation, forcing the water to flow normally and your water wheels should spin.
Huh? I've used a similar model before, and found that pressurized water flowing downhill still has enough pressure to 1) overflow the bank of a curve with enough force to smash dwarves and cats to bits and 2) continue to power waterwheels along the watercourse it empties into. Perhaps because the end of that course emptied into a source with constant flow? That was a cavern that was already submerged from end to end; this is a cavern that has dry land where I'm dumping all my water. The draltha better learn to love the tops of those mushroom caps.