One point to remember is that the "Land of Moab" was not controlled or inhabited by Moabites at the time of Ruth. Moab had not lived there for quite a long time. Israel took possession of the old land of Moab when they returned to the land from Egypt. The 2 and a half tribes, Ruben, Gad and half of Manassah took the land as their own.
No, Moses was specifically instructed not to fight with the Moabites, because God had specifically given their land to Lot's descendents. In fact, he had actually used the Moabites for his purposes - they had driven out the giants from that land at God's instruction, to possess it for their own, just as Israel was commanded to drive out the giants from the land of Canaan and take it for their own. In the same way, Esau's descendents drove out the giants from the land of Seir and were given that land as a possession, and Israel was instructed not to fight with them, and the same went for the Ammonites, the other tribe descended from Lot. God specifically used all these descendents / close relatives of Abraham for His purposes, and wanted all these relatives to live alongside each other in peace (though they actually ended up fighting with each other instead). Read Deuteronomy chapter 2, this is clearly outlined there. Particularly:
Deuteronomy 2:9-12 said:
And the LORD said unto me, Distress not the Moabites, neither contend with them in battle: for I will not give thee of their land for a possession; because I have given Ar unto the children of Lot for a possession. The Emims dwelt therein in times past, a people great, and many, and tall, as the Anakims; Which also were accounted giants, as the Anakims; but the Moabites call them Emims. The Horims also dwelt in Seir beforetime; but the children of Esau succeeded them, when they had destroyed them from before them, and dwelt in their stead; as Israel did unto the land of his possession, which the LORD gave unto them.
The 2 1/2 tribes inherited the land of Sihon king of the Amorites, not the land of Moab (Exodus 21).
Moab was certainly still in existence after the invasion of Canaan, Israel was even invaded by them and became subject to them for many years (Judges 3:12-14).
It would have been totally inappropriate for a respected member of the town to take a real Moabite as wife. Moab was a child of incest and on the forbidden to marry list for Israel.
Again, incorrect. Israel was forbidden to marry the Hittites, Girgashites, Amorites, Canaanites, Perizzites, Hivites and Jebusites, seven nations only (Deuteronomy 7:1-3). They were never forbidden to marry Moabites.
Descendents of Moabite men were forbidden from entering the congregation until the tenth generation (Deut 23:3), but this had nothing to do with incest, rather their failure to assist Israel during the exodus (Deut 23:4).
God did not consider Moab an incestuous people and curse them because of their origins (incest had not been forbidden at the time anyway - if it was forbidden at the time, Israel would be equally cursed since Sarah was Abraham's sister / niece, completely forbidden in the Mosaic law). Incest wasn't even considered. Rather, He blessed them as children of the righteous man Lot, and kinsmen with Israel. Both Israel and Moab were blessed, despite BOTH being descended from incestuous marriages.
If you are going to make such large statements in future, please first look for references in scripture to back them up with - that way you'll also notice if you've made a mistake.
Ruth was a Moabite - a descendent of Abraham's nephew Lot, certainly a relation to Israel, but not an Israelite.