Not the exact wording but the general premise behind it is a fair counter point in any disagreement. When someone is attempting to gain a higher moral authority, bringing up any hypocrisy is a reasonable thing to do. If pointing out hypocrisy is then dismissed, it is reasonable to assume the other person is not arguing in good faith and therefore should no be taken seriously.
Not particularly. Depends on the subject matter. For instance, a politician might be critical of current campaign finance laws being too lax, but still take advantage of said laws. In that situation it wouldn’t be hypocritical to say I want to change X, but until it changes, I’m following the same rules as everyone else.
Or maybe they are a hypocrite, I don’t know. They could be the worst person to raise the argument, but my only point was that it doesn’t invalidate the argument.