1 - If an event is cancelled, will the email still trigger? (My assumptions say no, but I could be wrong).
Maybe. If the record no longer meets the criteria, all pending workflow actions will be deleted. So your criteria should include something like "Event is not cancelled," otherwise the email would still be sent.
2 - What is the built-in logic for a TBW when an event has triggered an email and after the email has been sent, the event is updated? Does this re-trigger the TBW to send an email again?
Maybe. Because time-based workflow is a "rising edge" trigger, it will only trigger if the record no longer meets the criteria and then later meets it again. For example, if the criteria is "date is in the future", then the record will need to first be moved to a date in the past, then moved back forward. If the email was not already sent, the date would be automatically adjusted to the new delivery date.