With renewals the Ambassador certificate (digital) shows up in your account right away. Others can comment for new signups (I have been an Ambassador for 20+ years so not sure how quick the new ones show up).

Once in your account, there has to be an Ambassador weekend rate available at the hotel. If available for your nights, usually it is higher than the lowest rate per night for the same room, but then you are getting the 2nd night free so it ends up being less overall. One nice thing about Ambassador BOGO is that if available, it is usually available for many room types vs. just the entry level rooms free night/points can be used for. So you might be able to BOGO the club level room. You would need to rebook your Friday and Saturday night into a new reservation with that Ambassador rate, and then create a new reservation for Thursday night -- which may change your Best Hotels benefits (i.e. not sure if you need a minimum number of nights for the $100 credit, and breakfast would now just be night 1). I have combined Amex FHR booked nights with the use of an Ambassador BOGO before - in that case best to contact the hotel before booking and see how they will handle.

I don't think I have ever been upgraded to a club level room in my 20+ years belonging to the Ambassador program. As you said they just don't do it. That said I can only remember once where the hotel did not upgrade me at least one room level -- and even then they apologized for being full and not able to do it. You would have to ask them if they have any categories within the club level - i.e. maybe your premium club room could become a club level junior suite if such a thing exists - assuming you booked the same club level room for night 1 as well. Would keep in mind the one level upgrade is really just the Ambassador program at IC hotels -- as an IHG Platinum I rarely saw upgrades at any properties.

Breakfast is only free choice if you have IHG Diamond. You do get a small one-time credit to use during your stay that can go towards one morning's breakfast or other drinks/food. Assume your club room would come with breakfast at the club - but something to keep in mind for future stays.

Really the question for joining is can you make good use of the free night and/or do you stay at ICs a lot? The first time I joined it was a no brainer as I immediately saved a few hundred dollars on a stay at the IC Rio over New Year's. Since then have always renewed and made good use of the free night. And it was always nice to have Ambassador status the 2-3x per year I stayed at one, but never went out of my way to stay at an IC until a few years ago when I bumped up to Diamond. Ambassador + Diamond makes an IC a nice option.