I'm reasonably sure dwarf fort genetics aren't lamarckian. So sometimes is the answer to the first.
Inbreeding doesn't correlate to reduced intelligence in real life; In fact all inbreeding tends to do is exaggerate traits already present in the creature and make for a stagnant immunoprofile leading to a greater instance rate of disease. It has happened in history that many inbred royals and merchant families where quite intelligent when not wracked with disease or birth defects caused by the same over expression which likely granted them said intelligence. The Habsburg line is an interesting study as are several lines of french royalty.
So probably not to the second but ,then again, a lot of games tend to create inbreeding debuffs due to an oversimplified system of genetics which does not inherently possess any negative to rampant inbreeding so maybe.
All base physical aptitudes are confirmed (with a degree of randomization) and there is some signs pointing to mental aptitudes but ,as it is in life, that is harder to test.
Each trait ,with the exception of color, is handled on a bell curve with traits on either end being more recessive then the median, from what I understand.
No genetic disease that I'm aware of.
I would start with dogs and poultry, then move to trogs who i believe still don't need to marry. Then the civilized races who require marriage before mating and do NOT breed out of that relationship nor find partners after their mate has expired. Dwarves and, other such creatures, achieve marriage through prolonged social contact but there are homosexual and asexual dwarves as well as dwarves who will not marry for personal reasons outside of their attraction to a given gender.
It also takes 12 years to raise a civilized race to maturity and , as in life, it usually takes at least a few generations for the effects of breeding to be at all noticeable. So unless you can keep a colony alive for at least 120 years of careful and tedious experiments it is unlikely you will achieve any significant result from dwarf eugenics. Also dwarfs tend not to breed with close family which ,as you can imagine, makes breeding for specific traits a pain.
TLDR look in to natural/supernatural enhancement for dwarves; A good example for making superdwarves is constant military exercise with swimming sessions before making them vampires. Becoming a vampire multiplies several physical values based around the acquired stat not the inherent stat and then it stagnates the trait preventing stat increase through exercise. Same for necromancers. Werewolves stats don't stagnate.
Quick breeding animals like many egg laying creatures as well as any creature which births large litters are easy to breed though so animal breeding is very easy and simple. I would recommend trying to breed large fat muscular ill tempered war hounds and crocodillians. Animal yields from butchery are related to an animals various tissue sizes so some animals will produce no/little meat unless they are large, muscular and/or fat. If I remember rightly chickens provide little meat unless they are bred for size as the tissue layers on their extremities are too thin to produce yields without being both large and fat/muscular.