1) Is the US trying to encircle China militarily ?
Yes！
2) Does the USA see China as a real threat, or is it just being careful ?
Yes! A potential threat.
3) Would the PRC ever invade Taiwan, eventhough it may lead to a war with the US, and possibly also Japan ?
The PRC will never invade Taiwan.Taiwan is part of China,there is no doubt that China will get reunification on day.Whether there will be a war between Mainland and Taiwan,it depends on the USA's attitude.
4) Is it a good thing for the US to manufacture its own products in China ? It certainly helps corporations make bigger profits, but also creates unemployment in the US.
Yes! Globalism is good for the two sides.