2. Does the description field have anything to do with what is actually transmitted to the network or just for local reference within the Electrum app?
No, the description filed does not transmit any data to the network.
3. If I were to ever lose this .json I am assuming I could do a wallet restore with the recovery phrase. If I were to do this I would assume all descriptions I ever entered would be missing. Is this correct?
Yes, it will be lost because if the above obvious reason.