The first two questions are perhaps more fundamentally necessary, but the second two questions are more pressing. Before we go in to observe a session, we always need to understand that the goal is to look for tips and techniques that we think we can use to make ourselves better tutors - NOT to mentally critique the tutor or think to ourselves how differently we would have done something. This might be one of the biggest challenges of observation, because it's so easy to look at others and see what we would have done in their place; it's much harder to remain objective and simply jot down what happened, no judgment made.
Observing does, of course, naturally require some degree of evaluation; however the necessary evaluation is to pull out techniques that we may find useful, things we think worked, and reasons why we think some tactics may have fallen flat in this particular instance. This kind of evaluation is much different that sitting there and judging the other person's technique like we are some kind of tutoring god - after all, isn't the point of observing to learn and build up our skill set rather than to tear others down?
This brings us to the point of knowing what to look for in an observation. Chapter 5 in the Longman Guide has a whole list of analytical questions that may be useful to give us guides on what to look for as we go in to observe a session. Generally, Longman touches on looking for things like establishing rappor and a framework for the session to begin, addressing 'problem' aspects of the writer's work while still respecting them and their opinions, and the way the tutor directed the session to make it maximally productive. Since there are many, many different ways to do all of these things, seeing how others do them can help us - the approach we favor may not work in all situations with all students, so it can be useful to have a different tactic to draw on in those instances.
In sum, observing a tutoring session may seem like a silly thing to do - after all, we work there too, and we know how to tutor. However, you never know where you may pick up new techniques or see a tactic you really like. The more knowledgeable we are about tutoring, the better we'll be able to serve students - which ultimately prepares us to serve clients in the real world once we graduate and move beyond the happy little bubble that is academia.