Western scholarly work on "Buddhist studies" begun recently (also, Japan is said to have published more scholar work on Buddhism than the entire world combined).
Other than that, I think most "scholar work" has been written by buddhists for buddhists over the millennia (e.g. through commentaries and so forth) -- though focusing more on doctrine and not having much interest in establishing facts/history nor carrying the sophistication of modern methodologies (e.g. use of textual analysis; archeological evidences; the practice of publishing work for a larger community to criticize it; etc.).
1.How well studied are the Buddhist scripts? (compared to the modern study on Greek, Roman and medieval philosophy)
I think not as well studied as the examples you gave, but they are studied and people publish their findings.
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)
"Today Pāli is studied mainly to gain access to Buddhist scriptures, and is frequently chanted in a ritual context. [...] In Europe, the Pali Text Society has been a major force in promoting the study of Pāli by Western scholars since its founding in 1881. Based in the United Kingdom, the society publishes romanized Pāli editions, along with many English translations of these sources. In 1869, the first Pali Dictionary was published using the research of Robert Caesar Childers, one of the founding members of the Pali Text Society. It was the first Pāli translated text in English and was published in 1872. Childers's dictionary later received the Volney Prize in 1876.
The Pali Text Society was founded in part to compensate for the very low level of funds allocated to Indology in late 19th-century England and the rest of the UK; incongruously, the citizens of the UK were not nearly so robust in Sanskrit and Prakrit language studies as Germany, Russia, and even Denmark. Even without the inspiration of colonial holdings such as the former British occupation of Sri Lanka and Burma, institutions such as the Danish Royal Library have built up major collections of Pāli manuscripts, and major traditions of Pāli studies."
3.What efforts have people made to prevent misunderstanding caused by the observations I mentioned at the very beginning?
I guess they have studied and published their findings, like any other field (bound by funding, like any other field).
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?
If you take "loyal to Gautama's own words" to be the narratives that are considered by some to be "most likely" to have taken place and what most likely he actually said then you would likely prefer the body of texts that has more historical significance (than, say, doctrinal significance).
My understanding is that studies of "early buddhism" (the pre-sectarian period comprising the undivided sangha during and after the Buddha's parinirvana) focus on identifying early strata of the sutras and studying them. In general, the four nikayas/agamas (digha, majjhima, samyutta, anguttara) are the main interest of study here -- other collections which have been considered to be older are frequently considered as well, such as the Sutta Nipata.
But if you take "loyal to gautama's words" to be anything that can be understood as reflecting Buddha dharma, not necessarily his words verbatim, I think the range of literature greatly increases, encompassing every sutra that has been written and accepted by buddhists of any sect.