1. I'm pretty sure it is kavalactones or something else since even extracts and instants cause this to a degree
2. Unknown (see @infraredz responses http://kavaforums.com/forum/threads/why-is-kava-diuretic.2234/)
3. I don't think one can prevent diuresis but you can pay attention to hydration so that you don't suffer the side effects of dehydration