1. It is implemented as its own reader, but it uses arc/mzscheme-read for symbols and quotation syntax (the version at http://placebo.hpi.uni-potsdam.de/~robert.pfeiffer/arc/mexpr... also handles quasiquotation-syntax on its own, but is less well tested)
You can load a file in m-expression format with "(load-m filename)" (or "load-m[filename];").
2.Yes I have. The M-Expr reader converts into prefix form at read time, so the read forms look like arc code. M-Expressions are just a skin for S-Expressions, therefor I tried not to break anything by changing the run-time semantics of Arc (unlike infix.arc, which makes numbers callable, which my break drcodes currying (or my idea for automatically converting numbers in functional position into Church Numerals)).