1) No. The after-tax portion not rolled over is nontaxable.
2) The question does not apply.
3) Yes, it would be better to roll the after-tax portion over to a Roth IRA rather than a traditional IRA. To avoid any taxation of the distribution, the entire pre-tax portion (the earnings) would need to be rolled over, then whatever remains of the gross distribution minus the RMD could be rolled over to the Roth IRA.
For example, lets say that the gross distribution was $40,000, of which $30,000 was after-tax and $10,000 was earnings, and the RMD for 2023 is $2,000. To avoid any portion being taxed in 2023, $10,000 (all of the earnings) would need to be rolled over to a traditional IRA. After that, up to $28,000 could be rolled over to a Roth IRA, leaving the $2,000 RMD not rolled over. If less than $10,000 is rolled over to the traditional IRA, whatever portion of the $10,000 is not rolled over to the traditional IRA will add to AGI in 2023. If more than $10,000 is rolled over to the traditional IRA, the portion rolled over in excess of the $10,000 of earnings becomes basis in nondeductible traditional IRA contributions because that portion is from the after-tax funds.
One other thing: Because the earnings were eligible for rollover (assuming that the after-tax portion exceeds the RMD), an minimum of an amount equal to 20% of the earnings was required to have been withheld for federal taxes. Referring back to the example, coincidentally that would be $2,000 and would be sufficient to satisfy the RMD. If the tax withholding was actually more than the RMD, your husband would have to come up with funds from another source to replace a portion of what was withheld to be able to roll over (to either a traditional or Roth IRA) the entire amount that is eligible for rollover.
