1. Wouldn't put up with it, would look for one of the hundreds of alternative news sources.
2. Technology sector is always ahead of the curve, and I think places like cnet, engadget etc show you how news would operate without traditional old media newspapers. Websites build reputation on reporting, make enough to get by with advertising. One thing is certain, organizations like NY times have too much corporate bloat for an Internet company, at least at the moment I expect Internet to eventually take over most advertising and there will be more money to go around. For that reason it's also important for old media to get in and stay in early, which they have been so far.
3. No idea. I don't think quality will drop though, talent is talent regardless of who's your boss or the business model.