1) How about a box of Crayons? I had both as a child and got good enough at the Etch A Sketch to draw my childhood favorite firetruck, but the Crayons held an infinitely bigger realm of possibilities for me. For both me and my friends (6 out of 6) the Etch A Sketch was just a toy, more often frustrating than rewarding, but Crayons still hold that hint of magic.
2) Neither. I was 6 at the time. Back then give me a box of Crayons and I was Van Gogh.
3) I don't think it's just the toy being evolved here. It's more of an evolution of imagination (and it's use) than of any toy.
4) I don't own one today, no, but neither is it a beloved childhood toy. As stated above, I think Crayons have sparked more childhood imagination than any other toy. Crayons definitely take me back.