Another thing which happens frequently is that a company releases a buggy GUI product. Senior management screams for blood. After a while the bug count goes down, they stop using the tool and everyone is happy until next time. I don't know how to design that product, or I don't have the time, or both. That was the way the old project I mentioned ran.
Test cases go through versions, just like everything else.
It would be nice if you suggested some detailed requirements. You did indeed. I don't actually disagree with the requirements as far as they go. It's just they focussed IMHO just a tad too much on the implementation details of a test system, whereas the issues which concern me are elsewhere. For example 1.