If omitted, this is 0pt as the default. You must not specify a wrapfigure in any type of list environment or or immediately before or immediately after one. It is set within the figure. The ability to float is somewhat restricted, and you will get best results by giving exact manual placement, but floating is more convenient while revising the document. Any changes to the formatting can ruin your manual positioning so you should adjust the placement just before printing a final copy.
Small equations look fine.
It is possible that a non-floating wrapfigure will be forced to float when an earlier one is still being processed. A warning will be written in that case. A rare problem is that floats and footnotes specified within the wrapping text can also cause poor placement and bad formatting. In particular, the caption is always typeset with the specified width. This is particularly useful when the surrounding text contains extra vertical spacing that is not accounted for automatically.