Chip clearance is a function of the toolpath, part geometry, and dust collection — a deep narrow slot won’t have good chip clearance, a large, shallow pocket with an adaptive clearing toolpath will have good chip clearance.
Yes, usually round ~= ball end, though there are specialty endmills which are actually spherical.
For the inlay, I’d suggest using as sharp a V endmill as makes sense — you might want to consider Vectric Vcarve since it has explicit support for inlay, but it can be done by hand: