1. It is telling you that your upstream fuse may have started to operate before the downstream circuit breaker has fully cleared the fault under particular fault conditions. It is likely to continue so both fuse and circuit breaker will "trip"/"blow", i.e. you don't have a fully selective design (and even if it doesn't go, the fuse may well be preloaded and be more liable to let go on lower currents in future)
2. Not necessarily if full selectivity is not a requirement specified by the Client. Indeed for some arrangements this may even be desirable (e.g. backup fuses)
3. I presume because it would slow down the "normal" calculation, and not all designers are worried about selectivity (e.g. domestics and small commercials with tiers of MCBs...)

The Energy let-through 60x10^3 of the protective device is greater than the Pre-Arc energy 50x10^3 for the upstream fuse.

To make sense of that you need to understand that pretty much all overcurrent protective devices can continue to let energy through even after they've started to open. Fuses will melt and create a gap in the fusewire, but they'll generate an arc which will let current continue to flow, until the gap in the fusewire gets large enough to quench the arc. Circuit breakers also have arcs to deal with but additionally have a finite time between de-latching and the contacts physically moving far enough apart to start interrupting the current as well. Plus there's manufacturing tolerances which mean you'd probably take a lower limit for the pre-arcing value and an upper limit for the total energy let-though. Once the device has started to open, it's "committed", and will almost certainly remain in the open (tripped, blown) state even if the current is interrupted somewhere else first.

So too guarantee selectivity you need an upstream device that won't start to open given the maximum amount of energy the downstream device let though in total.

As for compliance - that depends on the situation - whether its' required for safety or correct functioning of the installation. Sometimes it's just not practical to provide it for all circumstances (e.g. where backup protection is needed to deal with large PFCs) and sometimes (e.g where there are 30mA RCDs on a caravan supply and within the caravan) impossible to provide.

   - Andy.

Can't tell you how helpful this was, Andy. Thank you so much.