I'm assuming your using basic SOHO or home equipment here. Based on what you've provided, clients behind both routers will have Internet access. Clients attached to RT1 will only be able to talk to the Internet and their connected peers, and clients attached to RT2 will be able to talk to everything.

All 3 questions depend on how the routers are configured. But assuming they are not doing any filtering then I would assume the following is likely

1. Yes
2. No NAT (with routes configured) - Yes.
   NAT - No.
3. Yes

If the cable modem has more than one ethernet port then connect Router2 WAN to the other ethernet port on the internet modem. If it doesn't you could connect it to a 5 port switch and then connect each router to that switch. Then turn on NAT for both router 1 & 2 and you'll have two independent LAN's that can't talk to each other.

What I would do is get a simple 5-port switch, and run that off of the modem directly. Then off the switch, add the two routers, each plugged into the WAN port. This will make them completely independent of each other, and both access the Internet. The two routers will only let computers attached to each one connect to each other, but not through the other router.

When doing it this way, you need to make sure your ISP will give you 2 IP addresses. In Canada, I know that Telus and Shaw give two IP addresses for their accounts, even to home users

The easiest and cost-effective way would be as follows:

Cable modem connected to Router 1 wan; Router 1 connected to Router 2 using Lan port -> Wan port;

Answering your specific 3 questions: Creating a subnet on Router2 having router 1 as Wan - Router 1 has access to Router 2, the opposite is not done.

EDIT: If the cable modem has more than 1 port, connect both routers there and turn on NAT for both. Future connections across routers would not be possible.