1) Sure you can. Just stop selling weapons to them, anything moved to Switzerland from anywhere else gets the full amount of bureaucracy thrown at it delaying it by a long time. Everything they have comes from NATO and EU members. Good luck buying Chinese "quality" and see how far that neutrality stance gets you with them.
2) And what do you think that money has been used for? To finance the Russian military actions of the last 20 years including invasions of Georgia and Ukraine, cyberattacks against NATO members, espionage etc. So Switzerland helping Russia to finance war and conduct cyberwarfare is any different from re-selling foreign produced weapons and ammo?
There is no such thing as "not caring" or "oversight" in this, either you do everything you can to prevent it from being done or you agree with what is being done and are happy to do business. Switzerland has taken the latter approach for the past two decades.
3) Not exactly, for example currently NATO and EU evacuation operations also take Swiss nationals including diplomatic staff. Good luck, you're on your own. Have fun being on the same blacklist as third world countries.