I have personally never seen the issue (what caused it) but I did have a look at another one from a shop that brings me stuff they can't fix in hopes that I can fix it. Lol. This one had some very slight water damage probably like 1 drop next to the charge port connector. Anyways I took a quick look in a 2 day period I could not find the cause. Everything checked out. I changed out the sketchy looking capacitors. I even changed the tristar and still same issue. Would not charge. Good luck maybe if I have more time with one in the future I may be able to figure it out.
No it won't work. Phone will think home button is being pressed all the time. Home button also will get hot. Best to just use 6s home button but say bye bye to Touch ID
Yep it's very likely a faulty (shorted) power button. Don't let this go on for too long as constant reboots can and will damage the storage portion of your phone. If it goes on for too long the software will corrupt and the storage won't mount and you'll have a bricked phone.
This would be pretty straight forward fix for any microsolderer. If you bring me just the board I'd do the work for no more than $100. Not promoting any services. Just saying. I'm currently not in front of schematics but it looks like this could be the culprit of your issues.
Your power button sounds like it's going bad. Very common issue with the iPhone 5. Apple actually launched a recall on the issue so if you can, bring it in to apple
You wil need to disassemble the phone and remove the board. There's a clamp and 2 screws near the SIM card reader. In that area you will need to perform a reflow. If the reflow is successful it will work after that.