1 Can you play it single-player?

2 You can. I've never played it multiplayer, for that matter. (Should try sometime, though...)

It's definitely more of an exploration game than Minecraft. Most of the building I do is on the lines of "I need this to get around easier" or "I want to fight the boss here" or "I'll grow my underground mushrooms here", instead of Minecraft's sand-castle-box feel. On the other hand, the game part is realized a lot better - durable equipment, and lots of it, means you're generally working towards a goal (i.e. "get better gear") and with a specific goal in mind (beyond "dig and hope I hit something good"). There's a few boss monsters and monster events, and a good variety of weird stuff.

Definitely worth what I paid for it.

3 I'm thinking of running up a mee.nu Terraria server - partly to experiment with Windows Server.

4 I'd fiddle with it.

5 Thanks to you mentioning it to me the other day, Pixy, I've got hooked again. Gah! I've also not played multiplayer, but colour me interested if you get a server going.