The Amiga floppy drives took standard 3.5" media, and they could read MS-DOS disks, but the software for this wasn't included with the OS until 1992.
Section 9.7 in http://www.faqs.org/faqs/amiga/introduction/part4/ says you could do this with Workbench 2.1, which was released at the end of 1992 (http://www.gregdonner.org/workbench/wb_21.html).
Of course, PC's later had double-density disks that could host 1.4MB but Amiga only ever had single-density disks in practice.
Yes, they could; software to read/write alternative formats on the PC was, well, I’m not sure how common, but it was floating around. It wasn’t a controller issue, it was a DOS format issue. Similar software was even available for the 360KB (DOS formatted capacity) 5¼” floppies on PCs before 3½” drives were available.
> Of course, PC's later had double-density disks that could host 1.4MB
“high-density”, and 1.44MB DOS formatted capacity.
> Amiga only ever had single-density disks in practice.
“double-density”; single-density 3½” disks may have existed, but I don't think anyone used them in significant numbers.