FTM with PCOS here!
I'm about 2 months on T, so I can't say much about the future but I can tell you that the only thing that will happen when you inform your doctor that you have PCOS is they'll put you on a lower dose of T compared to the "average" dose, because with PCOS you already have elevated T levels. But don't be alarmed! I'm on 1/4 of what's considered the average dose of T for FTM guys and I'm already seeing insane results. It really depends on how your body reacts with it.
After a few months the doctor will note how your body is reacting with the new influx of hormones and the dose may or may not be adjusted from there. My doctor personally wanted to give me more time to "adjust" to the T because of my PCOS, so when I'm around 4 months I'll be going to see her again and we'll see what happens.
As for your questions:
1 & 2. My doctor never mentioned anything about the cysts getting bigger or even cancer, but she was more concerned with my already-elevated risk of heart disease and diabetes due to the PCOS, so she wanted to take it slow.
3. As for most trans men that take T, your emotions, thoughts and general reactions are subject to change. I know that personally I've changed a LOT since I've been on T already, but it's all been for the better--except for the sex drive. That's been kind of a bother.
4. Body hair growth is very subjective to the person's genes. Almost all of the men in my family had zero body hair, but even when I was pre-T i had more leg hair than my dad. However, because of the lack of body hair in my genes, I'm not expected to grow a ton like some other guys do. But who knows? HRT is basically a wildcard! As far as masculinity goes, your idea of masculine may be very different from someone else's, so no one can really answer that. If you mean physical changes, I don't think they'll be much different.
5. At 2 months, my periods are already starting to go away. I recently had one that was very stereotypical of FTM cessation of periods, but again, T is basically a wildcard, so I don't know when it'll end for sure.
Tl;dr, you can't really predict what will come out of your HRT process as far as changes go, but the doctor will likely err on the side of caution when it comes to your dosage.