I'm pretty sure you don't need to incorporate to take deductions on self-employment expenses. Self-employed income isn't just a free ride to a kick in the balls - if you're paying that extra 15%, you get to take expenses as deductions. If it's low-level income that is just covering expenses, you're not going to owe the IRS a dime.

I'm 100% sure. You can deduct all expenses including medical insurance for yourself.

While it's correct that you can do a Schedule C on your personal return, being incorporated makes your position a lot stronger.