1. No, you do not need to buy any other extra plugin, theme or add-on. Dokan has a built in frontend feature and you can turn off back office access.
2. Yes, if you want to pay the sellers instantly, then you must use PayPal Adaptive Payment add-on. This add-on makes the sellers a primary receiver and the admin a secondary receiver. Admin and the sellers, I mean everyone can receive payments in real time.
3. According to PayPal rules, the primary receiver is always the person who makes the refunds. So if a customer files a dispute, the seller will be liable for refunds.