A: It's not just about having the best hand (well, at the lower levels it is, overwhelmingly) but about having good position and a good "spot" in terms of your opponents and the texture of the board - sometimes folding the best hand (even if you have a feeling there's a chance you DO have the best hand) can be a good move if you're in danger of losing a lot of money on later streets (or being made to fold or make other mistakes under pressure). Being comfortable is a huge +ve in poker and a good way to do it is not to push yourself into difficult situations that you're not going to be happy in.

And, from a broader point of view, yeah, of course sometimes you have to fold the best hand in any form of poker - you shouldn't lose any sleep over it.

A: I haven't really played below $100PLO for any significant amount of time, but the "big" mistakes (stacking off with limited equity, making big river mistakes, throwing away money with AAxx) you make a ton of cash on in the smaller/weaker games become much less prevalent higher up. I think the aggressiveness of the tables varies a lot, however, and from site to site. Above 200 I've always felt it can be a bit more aggressive and there are usually fewer players in the pots. There's usually a few good players at the table you have no real advantage over mixed in with one or two poorer ones and the occasional nutjob maniac (although these seem to be few and far between in my games at the moment). I guess a lot depends on the site you're playing on - 200 games at Stars are reasonably tight-passive IMO.