I too have built three exhibition layouts and have helped in the building and operation of numerous others, I also go to a fair few exhibitions as a visitor so to answer your questions (and speaking just for myself, I should add):
1. I do want prototypical operation. To me it's the whole point of building a model railway, to be exhibited or otherwise. If there are signals then they should be used properly and trains should obey them, although for a large home layout I built I used Knightwing kits which did not illuminate, but in my mind the trains were still acting upon the aspect I imagined was 'displayed'.
2. There will inevitably be gaps in the train movements, there are gaps on the real railway. Some viewers will walk away, some will look at the detail on the layout. The important things is to try and avoid long gaps because something has gone wrong or because the operators have made a mistake.
3. I do occasionally read additional information and it can be helpful, but I would keep it brief, to the point and in quite a large font so it can be read easily.
4. Having operators discussing the next train movement always seems to me to be rather poor, and often leads to one of those 'gaps' you want to avoid.
5. I like digital sound on the trains themselves and I think they enhance the viewing experience, but beyond that I'm not really bothered. Those layouts that feature birdsong or other ambient sounds always seem rather gimmicky to me.