1) I'm not much of an expert on periodization but i used it in SPP for lactic tolerance work, definately not in comp. phase because of how draining it is. Like you said, it's too difficult to be run early season and too stressful late season.
2) That is actually how i do it but since I don't believe in running slower than the slowest part of the race in workouts i called it '400 finishing pace'. I stop the workout if i start running slower than 30s.