When the plugin almost does it.

Normal web development builds pages. Custom development builds behaviour — rules, calculations, states and permissions. The design work is often smaller and the thinking work much larger, because the difficult part is your logic rather than the layout.

Usually the opposite. Custom code has fewer moving parts and no third-party update schedule, so there is less that can break without warning. What it does need is a developer for changes, whereas some plugin settings can be clicked. That trade is worth making when the logic is genuinely yours.

Yes. A purpose-written plugin or theme extension is often the right answer — you keep the CMS your team knows, and the specific behaviour is written properly rather than approximated by three general-purpose plugins.

A fixed price for a clearly defined first version, quoted after a mapping session. Not hourly, because hourly billing makes it my problem to work fast and your problem to guess the total. Later additions are quoted the same way.

Small clarifications are normal and absorbed. A genuine change of direction is quoted as a change, at the time, rather than silently squeezed into the same budget. That is how projects finish rather than drift.

If it runs in a browser and your customers or the public use it, it is usually web development. If it is an internal system for your team with roles, records and workflow, it is closer to software development. In practice the line blurs, and one call will tell you which side you are on.