I don't agree with #2 but if it's important to you than that's fine. I toured down there with 700c wheels and it was fine.

I can't answer your questions about wheels... in fact I'm curious about this too.

What I can offer is route ideas. I was down there a couple years ago for 7 months (http://www.crazyguyonabike.com/doc/vagabondingsa). You'll hear a lot about the Carretera Austral and the Lake District which are great but there are other gems. If you like stunning views of the Andes you have to hit the passes.

Paso Agua Negra is amazing! I write about it here, here, and here.


Another great pass is not far from Santiago which I write about here and here.


Finally the Atacama Desert is often avoided but it was probably my favorite spot. It has an endless horizon with nothing but sand but it lets you explore your mind and the night skies are amazing. I write about it here onward for two weeks.


You'll find lots of route ideas at crazyguyonabike. Check that out and see what looks prettiest and feel free to ask.