This is because Microsoft intentionally breaks excel and PP compatibility with Google docs in small but important ways. It's the only thing keeping them afloat at this point. I have gotten into heated debates at work over this, because I prefer Google docs, but my boss will be like "we need to deliver this to customers who will open it in office and the formatting will break" and I'm like "that's what a pdf is for."

I would doubt it, it is nowhere near as good as office and google sheets specifically has much smaller worksheets than excel, with only 26 rows.

As far as I can tell, Google Docs is at feature-parity with Office, and yes, is incredibly popular. The contest might be a bit more even in the corporate space, but at the last three companies I've worked for, GSuite was the default and you had to ask for Office.