Since you only have to do transactions to put a balance on coinbase and then can spend it over multiple transactions, does that help scalability?

I firmly believe in keeping your own private keys but I think it's an acceptable cost to give up ownership of a small fraction of your bitcoins and trust coinbase so you can do a few everyday transactions.

I don't know where exactly to draw the line but it would be 0.5-10%. Obviously a lot less if you have a large amount of bitcoin.

Are those services good for the ecosystem in total? How does it all work? Who gets the processing fees from the merchants running the Point of Sale?