When you are working to an unusual requirement, "generally" is a dangerous word.

Serif characters are easier to read in most normal book or newspaper point sizes, but the serifs are just clutter if you really need a small size, and for the "fine print" a sans serif is likely to be the more easily readable. If you push the limits on fine print sizes, it becomes even more important that the leading is adjusted (usually increased?) enough to make a clear channel between lines, but the space shouldn't be big in proportion to the size of the individual characters you have to recognize, so that readers don't lose their place when the go from line to line.

"Dressing things up" when you layout the type is more art than technology, but it is sometimes important to know that the "point size" only specifies the size of "a box" that the printed character image fits inside. Some faces include characters that nearly fill the box, but most don't. A fairly rare few have an upper or lower "extender" that runs outside the box, making them unsuitable for anything other than headlines or "banner lines."

The "M" character is often considered the "measure" of a typeface size. An m-dash is a little shorter than the width of the "standard character box" for the face, and usually closely matches the width of the u.c. M character; but it's a fairly good indicator of relative sizes for similar fonts. An n-dash is a little shorter. In many faces, a hyphen is pretty much the same length as an n-dash, but a few fonts make an additional distinction (a "nit" of difference since only dedicated "nit pickers" can even see it, for most cases). If you're doing a layout for a "real" print shop, it is important to use the "correct" dash according to the applicable style manual - even if they do look alike in the font you expect, since a last minute change in the font (or substitution of a "well it looks just like-" font) can turn your work into something ugly that takes a lot of hasty corrections. (And with a busy* book printing shop, missing the submittal deadline by ten minutes may delay the book release by a year.)

* Busy means good enough to have lots of customers. You want one of these, dispite the difficulties, usually.

The height of the M character is nominally the height of the "tallest" character in the box but usually isn't the full height of the box, since some blank "extender space" is usually included so that type set with "zero leading" still will have a gap between lines.

The "unfilled box" means that you can't put a ruler up against a printed page and directly "read the type size." The character height (from the M) of 20 point Times New Roman on my computer prints at about 14 points "tall." The printed character height of the "8 pt type" sometimes specified as the minimum legible for some kinds of legal stuff may be more like 6 pt or a little smaller in actual measure.

The distance between the bottom of the M in one line to the bottom of an M directly below it in the next line could be the "font size" but an alternate amount of leading is nearly always present, so you have no real way of telling the actual size used by any "simple" measurement of a printed page.

The I - l (l.c. L) - 1 (#1) confusion is a sort of difficult situation, and until variable spacing was fairly common, few older typewriters even had a "1" (#1) key. The l.c. l (L) was used, and many current fonts actually do still use the same glyph for l.c. L and #1. Serif or non, they'll look the same in the same "font family" if you're using one of these, although the serif does usually, but not always make the I (u.c. i) distinctive.

In most text, it's not necessary to have a distinctive difference between these characters since the context tells you which is intended. In technical work where there's a possibility of ambiguity, a "technical" or "symbol" font should be used to distinguish equations or program code and the like, where the distinction must be clear, from the "body text" used elsewhere, and these kinds of font families do usually have clearly distinguishable glyphs that aren't easily misread even without a context.

John