Does knowing Pali/Sanskrit (and to which level) give one more insights while reading Buddhist scripts? I think we all have experienced with our own native languages how works written a while back can have different words for the same meaning or the other way round. Also that words get lost in translations, almost inevitably. Metaphor and other rhetorical uses of a language may be hard to detect as well and last but not least, the lack of modern scientific terminologies may likewise contribute to ambiguity and confusion.

Therefore I'd like to pose the following questions:

1.How well studied are the Buddhist scripts? (compared to the modern study on Greek, Roman and medieval philosophy)

2.How well studied are Pali and Sanskrit linguistically in the context of Buddhism? (compared to ancient Greek and Latin, or even Arabic/Islam if someone has experiences)

3.What efforts have people made to prevent misunderstanding caused by the observations I mentioned at the very beginning?

4.Although I know there are such things called canonical scripts/literature, I'd still like to know others' opinions regarding what (and maybe how) to read, and what to believe literally. 
ps: my personal preference would be those that are most loyal to Gautama's own words with few extended discussions and little personal guessing, but what scriptures would this comprise?
Pali is difficult to translate into western languages due to lack of expressive power. Though there is much effort to study the Pali cannot there are instances where translators / teachers / lineages have disagreed on meaning. E.g.  What is the Interpretation of Parimukham in the context of Buddhist Meditation?

In instances like this Goenka advices to take meaning:


Easy to understand on how it is to be practiced, i.e., which is not abstract, philosophical or purely theoretical
Which is actionable, i.e., which can be put into practice, not pure theoretical conjecture or not purely theoretical which cannot be put into pratice 


E.g. "keeping your mindfulness in front" is not like keeping a glass or something in front of you. This is abstract and not practical. Keeping your mindfulness around the mouth is neither astract nor impractical. Since these are instruction to be practiced it should be practical and actionable.

Especially in English some translations are loose fit hence some argue that the particular rendering though they principally agree on the meaning can lead to confusions. E.g.


  In order for meditators to understand the term sampajanna, we have translated it as-'The constant thorough understanding of impermanence'. It is felt that this translation conveys more fully the precise meaning of the term used by the Buddha. If the term sampajanna is translated too concisely into English its meaning can be lost. It has usually been translated as clear comprehension, bare comprehension, etc. At first glance, these translations appear to be correct. However, some have taken this to mean that one must merely have clear comprehension of bodily activities. Interpretations such as this may have had the effect of misleading some meditators on the path of Dhamma. To try and minimize any confusions for meditators the more wordy translation- 'the constant thorough understanding of impermanence'- has been chosen.


Source: Sampajanna-the Constant Thorough Understanding of Impermanence

Though strictly necessary knowing Pali would definitely help in understanding the teaching. There are many books which still has not being translated into other languages. E.g. Parajikan Atthakatha see: U Ba Khin and his reference to Parajikan Atthakatha

There multiple research groups which research the scriptures like:


http://atbu.org/
http://www.iabu.org/
http://www.bristol.ac.uk/religion/buddhist-centre/
http://ocbs.org/
http://gsas.columbia.edu/content/academic-programs/buddhist-studies
http://www.cbs.ugent.be/
https://www.bcbsdharma.org/
http://www.shin-ibs.edu/
http://buddhist-studies.uchicago.edu/
https://www.soas.ac.uk/buddhiststudies/
http://www.buddhism.hku.hk/
http://buddhiststudies.berkeley.edu/
http://www.international.ucla.edu/buddhist
http://www.digitalhimalaya.com/
http://www.bpu.ac.lk/
etc.


In addition the institutions which does Etymology studies:


http://vridhamma.org/
http://www.palitext.com/


Also there are prominent people who does research on this front. Excluding people tied to universities and institution following are very prominent:


Ven. Sujato - https://sujato.wordpress.com/
Piya Tan / http://dharmafarer.org/. E.g. on essay written in this area is: Language and Discourse
https://en.wikipedia.org/wiki/Bhikkhu_Bodhi
https://en.wikipedia.org/wiki/Nanamoli_Bhikkhu
https://en.wikipedia.org/wiki/Nyanaponika_Thera
https://en.wikipedia.org/wiki/Nanavira_Thera