We have a tank that used to be a RCS tank, that we then moved our CPDs into. Needless to say, there were shrimp left, and though it can't be proven, there weren't any new babies seen when there were shrimp in there. Can't be sure that that shrimp ate the eggs but...
In regards to other questions, we have about 10 CPDs in a 10 gallon tank, so I'm not sure when someone says that a tank is too small...
I'll ask my roommate on some breeding advice and get back to you
ETA: A few breeding tips:
Have more females than males.
Have moss or something in the tank, for them to lay eggs in.
Ours seem to do better when water hasn't gone through a water softener, I don't know if it is the salt or the TDS.
Feed them well.
We are in no way highly successful at breeding them, but we have some that have spawned and been able to raise the fry.