Can I use 10M02 to Remote System Upgrade over UART with the Nios II Processor?

Hi, IMHO no, NIOSII require 600 LE, M02 has just 2K and limited resource, single configuration.

Min size to run NIOS I think has to be 04 preferred 08.

question 1: yes with small code, 02 is still too small but can be large enough to fit your application.

question 2: again no idea of code you wish load on.

question 3: on Qsys block you have to tick initialized ram/rom then link to file containing data. (.elf has to be converted to supported format, or tell compiler generate hex too)

Experience when I used Nios, adding flash controller, timer, JTAG and few peripheral project grow to 7KLE or more.

here is reference of size of NIOS variant

https://www.intel.it/content/www/it/it/products/programmable/processor/nios-ii.html

From MAX table overview you can evaluate user flash size, 02 has single configuration, so no way to load new configuration in safe mode.

https://www.intel.it/content/www/it/it/products/programmable/fpga/max-10.html

Regards