They can't. Miui is not compatible with 7.1 CTS
http://www.androidpolice.com/2017/01/11/google-is-making-oem-support-of-androids-directly-reply-and-notification-bundling-features-mandatory/
Unlimited free storage is available for every device. If you mean unlimited original quality then I hope this is not forum for warez, it is not a free feature.
I don't know. You just can't pass CTS test without Googles propiertary packageinstaller and thus use Google apps legally (I mean device manufacturers). I don't remember if this change came with Nougat introduction about a year ago.
I think Google doesn't allow other package installer than their own, so Xiaomi can't use that with Global roms. That it why I wonder if it is wise to use it with EU rom.