I can answer all: 27mpg highway is still pretty low. I have a short commute, and my SID reads a pretty consistant 24mpg mixed. part of this is because of tune, and part because of how I drive, but if you're not driving a modied 9-5, you should expect 29-31mpg highway. (maybe more)
Open loop and closed loop are just the different operating climates of the ECU.
Closed loop is when the ECU ignores Everything but the oxygen sensors. The ECU is making adjustments to fuel trims based soley on the feedback from the Oxygen sensors to reach 14.7:1 air-fuel, or Stoichiometric...
This is typically in operating situations of low-risk. (full operating temp, no load, low RPM, low vehicle speed, little-to-no throttle) these are situations where the ECU thinks it's safe to run less fuel because there's no chance of engine damage. This is your idling, your highway cruising, and really low throttle imput (no boost) for the most part, the ECU can compensate for bad sensors, but there are things like exhaust leaks and some vacuum leaks that can cause fuel trims to go way-off. for instance, a leak in the exhaust before the first o2 sensor will allow clean air in, and trick the sensor into thinking the car is running lean, so it will add fuel to compensate. This will cause MPG's to be off. A failing oxygen sensor could be cycling slowly, or reporting incorrect information back to the ECU. again, it'll throw off fuel-trims.
Open loop, the ECU is reading the multiple sensors to calculate the air mass entering the engine and fuel accordingly. This mode ignores the oxygen sensors and fuels accordingly to reach a target Air-flow ratio, which has been user-entered (factory entered).
This is where you ECU is when your car is too cold, too hot, is loaded (boost/acceleration) is in high MPH, or >20% throttle position. This is what tuners tune.
The down-side is that while reading the air temps, the inlet pressure, the engine temp, knock, and barometric pressure if any of those sensors are reading incorreclty, it throws off the air-fuel ratios and causes the car to run poorly.(too rich/too lean) depending on the sensor, it can cause the ECU to run in open loop when it's not supposed to, and THEN run poorly, on top of that.
Having the scanner allows you to see the sensors operate, and if you know what you're SUPPOSED to see, you can tell if a sensor is reading incorrectly. I will post the plug I bought from ebay in a few minutes. Gotta get back to work.
here's more info from a mustang forum. the basics apply.
Definition of Closed Loop vs Open Loop