>>16762626A. The superior organism will take over. Regular animals have no chance competing against super-animals. They more than likely also competed with humans for living space too, but in the end, humans and Pokemon learned how to live in almost perfect harmony. The post-apocalyptic world soon split into several political "regions," and life began anew. Children were told myths and legends about the origin of Pokemon because the actual truth is thought to be too horrifying to them. If we played the games from the perspective of an adult, we'd probably come to understand the world a little differently.
B. Not entirely. Some humans became Pokemon, like Mr. Mime. However, a vaccine was more than likely developed, so that people could retain their humanity.