@hsgonzales Thank you for being interesting in mudfish. Here is my answer:
Definitely nop. If you want to use WFP Item mode, you don’t need to turn on.
Yes it should. If not please let me know. 
Umm.. I think you already checked MUDEC_00496 error link. When I checked the result of driverquery command, it show the following drivers are running:
- ANOD Network Security
- Kaspersky Lab
Not sure that it affects to this behaviour but I think you can try to uninstall these and test whether it makes any difference.