@Techbilt - 1. Yes, you can still live in Newcrest but work in Sulani. No reason why not.
2. The dolphins don't do anything particularly. They're part of the marine life in the water. Your sims can pet them, talk to them (builds the social need) and splash but there isn't anything else to do with them. Nope, you can't adopt them.
3. There are festivals but they're a bit more low-key than the City Living ones. You don't get a notification, they just happen. Some are a competition, others are like a community barbeque. You'll know when one's happening though because when you're in the main 'town', you'll see balloons and banners all over the place.
4. The swimming's now got new animations, yes (at level 3 of the Fitness skill, if I recall).
5. Those powers are available to all mermaids, yes. I've read that certain elements are available to only good or evil sims but don't hold me to that. I haven't worked extensively with mermaids, so somebody else can probably answer that better than me.
Does that help?