* What is the level of Amiga OS3.1 support?
Very good with non hardware hitting programs. You can even run WB3.x instead of the Ambient, if you want to have classic Amiga setup instead of more advanced system

* Can it run WHDLoad style games? (be gentle with me here!)
Only if you run MorphOS on real Amiga where original chipsets are available. Otherwise old hw-hitting games must be ran with UAE. But newer gfx-card and AHI supporting Amiga games work usually just fine.
* What is the Native application support like? (Office type, Web browser etc...)
There's pretty good native application support on smaller apps, but with some application types you still need to use Amiga programs. In practise you can't see much difference are you running native application or Amiga application. For native web browsing there is Sputnik, which has modern engine... and Papyrus Office is native office kit, but I'm not sure about it's future development. I'd say one of the most important native application is mplayer. It's working very well and with good support. That's one thing real Amigas can't do.
* Is it quicker than say 3.1 on an unaccelerated A1200?
Uhm... How it couldn't be faster?-) If you run same app on A1200 or on MorphOS, there's just ridiculous big speed difference

Only thing where classic Amiga can be faster is booting time, but that's when classic Amiga doesn't have any patches etc ran on startup. MorphOS itself boots in couple of seconds, but OpenFirmware things take some time in the beginning.