Great questions.
1) the processing is happening aboard the sensor, counts are what are sent back to the servers
2) we don't do unique identification like that. We use object detection, which is different than using unique biometric markers like face detection. That means that we can track a person or a car within a frame of view, but not if they exit and re-enter the frame like in the case you described.
Does Density still use wifi pinging for part of its counts?