Normally, the USCIS will put the naturalization case on hold until the criminal matter is resolved. If you are convicted, then it could result in a finding of lacking the required good moral character. I have seen cases with a single DWI get approved, but there is no guarantee here. If your case is denied, then your spouse will remain subject to the numerical limitations and will have to continue to wait for her priority date to become current in order to apply for permanent residence....
1. Your approval does not guarantee her approval.
2. I have been seeing these applications take a little as 30 days and as much as 4 months.
3. Yes, there is a chance of denial if you do not adequately explain the conviction.
4. I think that you should at least consult with an attorney. They can help you to deal with the conviction.
As long as your intent was to visit at the time of entry, you should be able to apply for permanent residence through your spouse. The key fact here is that you entered with inspection, so the overstay will be forgiven.
Practically speaking, I think that you should use a US attorney. I am a US attorney that practiced in Canada for awhile and that can be a problem as USCIS will often refuse to mail items to Canada. When you do get them to do so, they use regular mail so something that could be received in a few days in the US could take 2 to 4 weeks to arrive in Canada. This is an inconvenience in terms of requests for evidence and other matters that could delay the adjudication of the application.