Futures - Eurodollars basic questions

I’ve been learning about trading futures markets and had a few basic questions.

The Dec-20 Eurodollar trades at 98.59 (i.e. by Dec-20 investors are expecting 3 month LIBOR rates to be 1.41%).

Now the notional on these contracts is $1million and you only need margin of $550. Which begs the question, why would any retail investor trade this product since its so highly leveraged. Is there a way to choose to take less leverage than that?

Since each tick is $12.50 am I right in thinking that if you did just go for the $550 initial margin payment then the contract would have to move 0.22% against you to wipe you out?

I’m just trying to ascertain if the $1M is simply the exposure that you get, or whether any fluctuations in the futures contract are marked against that large notional amount.

One final point, other than the fact that futures let you take delivery of the underlying if you choose to, why do people trade futures over options? Surely the option is more conservative as you know your downside risk ahead of time.

Thanks.