Hi Sachin,
1, It is not supported that material and service are maintained in the same repository. They should be in the seperate repository.
2, Please refer to 6) in note
1077701 - SRM-MDM Catalog - FAQ
3, I believe you mentioned is non-stock item, and for such item, it can be transferred from catalog to SRM.
4, In SRM, you can distribute SRM contract to catalog via report or just set the indicator while creating contract. For MECCM, it is used for uploading contract from ECC to catalog.
Regards,
Ivy