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It is used for charging batteries, not providing constant power. It disengages on lane change according to the article, but that should not be a problem if there are batteries.

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Sure, but you'll be disconnected for that and you're going to have to reconnect on the far side. That's going to cause some arcing and wear. On the plus side, self driving cars will have something to aim for. Provided there isn't any snow or ice to deal with.

Arcing seems trivially prevented by utilizing two-phase connect and disconnect processes. Don't flow current when changing states.

Arcing from a rail that when filled with salt water gives off 1 volts up at road level?

Water under voltage forms a resistor network (effectively). After some distance it's not that deadly if you don't have potential to neutral.

Arcing may also occur under high current situations with low voltage as long as an arc forms early in the disconnect (just test it on your car battery)

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