That's probably the second of the effects I mentioned, if you interpret “actual” narrowly enough.
I'd guess that with different types of exercise, e.g. weight training, the first effect might win instead.
I'm not sure. Meditative trance states do have shown in some cases to be able to replace sleep. When I dance well I think it's plausible to be in a trance state which cuts down on sleep.
The question is - am I doing enough exercise?
I intend to provide a worked example for you to work alongside with your own calculations and decide if you should increase or decrease your exercise.
The benefits of physical activity are various and this calculation can be done for one or all of them; some of them include: