*2. yes they can if they don't have a load, but as long as they have a load (for example a wooden pipe) they will never explode.
In fact, they can also explode if you daisy chain them (i.e. trying to get more items out of a pipe).
As to upgrades, there are upgrades for the IC machines (macerator, extractor, electric furnace, etc.) which allow a higher voltage, more inbuilt energy storage, or faster running.
There are upgrades to the forestry electrical engine, which are circuit boards with tubes soldered on (increased output, decreased draw, etc.).
There are upgrades to the factorisation barrels (VERY large inventory space).