The food/drink they ingest is burned up in an internal "stomach" of sorts. They don't excrete waste like organic beings do. An exo's only waste byproduct is heat. Exos males have thermal venting and internal heatsinks. The females also have thermal venting, but their much smaller size requires external heatsinks. A pair of them in fact. [spoiler]And that, kiddos, is why female exos have boobs.[/spoiler]

Yes, but it isn't necessary for survival. It's done for the pleasure of it. Exos are able to taste what they eat and drink and can even get intoxicated.