1) Typically the systems monitoring, if not the systems themselves, is dumped on the police along with the funding. I agree in principle that police data systems should be handled by an arms-length agency without ties to any particular police service. I also believe this should include their body cams, interview room video, and even their fleet and weapons/ammo tracking. They should not have any oversight over their own data because that leads to the potential for abuse.
2) At least where I am... officers can query, but queries of federal databases are audited and monitored. You've never seen someone walked out of a building faster than when they are caught with their hand in that particular cookie jar. And yes, charges happen for the serious incidents. However, that still leaves a lot of room for abuse of non-federal data.