To respond to your questions as best as I can . . .
1. It started with Otto Octavius, pissed off that Ben insulted Anna Maria for her stature by offering her the perfected proto-clone body and that the "Jackal" he was working with turned out to be a Spider-Man clone, setting off the frequency that would trigger the Carrion Virus's degenerative effects to spite Ben and ruin everything Ben had created. Ben then took it even further by extending the frequency to cover the entire country, if not the world, intending to "reanimate" everyone like he had done to others before and thus usher in a world without death (Cancerverse, anyone?). Peter managed to generate a countersignal to stop the degeneration process using the Webware to broadcast it all over the country, but by then Ben was already starting to show signs of degeneration with his jaundiced and scarred skin after Otto destroyed his Webware. He had to steal someone else's Webware when he escaped and he would have taken the New U pills to help, but the real Jackal, Miles Warren, pretty much destroyed everything Ben kept in reserve as part of his revenge for what Ben did to him to keep him in line, so he's now living on borrowed time.
2. I'd presume he was cured of the Carrion Virus, but not of his prior degenerative condition. As such, he's also living on borrowed time, which he's using to hunt down Ben and bring him to justice for what he did in The Clone Conspiracy.
3. If Ben does ultimately find a way to cure his and Kaine's clone degeneration, I presume they'll go back to having smooth, healthy skin (and Ben might dye his hair again, since he no longer has a need to impersonate Peter Parker as his contingency plan for if Peter didn't want to cooperate with him).
4. Pretty much, yeah. Clones can live for years without showing immediate symptoms of degeneration, but later start succumbing to it as their cells begin to break down more rapidly.