2.) Acknowledging the Armenian genocide undermines the civil religion and national myths on which the Kemalist state is based; worries range from outside attempts to pressure Turkey into the role of a penitent state with a shame-filled citizenry (such as Germany) to emboldening domestic opponents (such as Kurds and Islamists) of Kemalist Turkish nationalism (which has its roots in the Young Turks and similar reform movements within the Ottoman Empire).
3.) As far as I know, it still hasn't so far. The reason is pure state interests (which may or may not be consistent with the "greater good"); Turkey has been and (to a lesser extent) remains a very important strategic ally. This is similar to the Devil's Bargain we made with the PRC regarding Taiwan (where we publicly pretend to support china's official line, while blatantly demonstrating otherwise).
4.) I'll address this later.
5.) Frankly, no; I share the position of the Executive branch on this matter, and I think Obama is demonstrating responsible statesmanship on this issue.
6.) Any state with public schools already does this to some extent; historians themselves often disagree on history, and the state (directly or indirectly) chooses who writes the textbooks.
7.) Well, in moral terms its about as special as acknowledging the genocide in Rwanda (where less died, either proportionately or in absolute numbers, but where the perpetrators and some of the victims are still alive) while effectively doing nothing about it.