Smart card are based on standards defined for hardware and the software (operating system) residing in them. There are many standards which defines the hardware features. You can read through some smart card topics in net for hardware interface and design of an smart card.
In short I will try to give some answers below:
- The contactless cards are better than the contact ones as they don't have to go through wear and tear life cycle. The life span of the card is dependent on the number of read and write cycles only.
- Even if the card chip or hardware gets damaged cause of acid attacks, it can destroy the card but will never let some one to extract data like keys etc. Data loss is possible but not data theft
- A smart card design standard have to implement some time based logics and some advanced techniques to ensure that the private key operations take some fixed time for operations. There are some security embedded in the crypto processor and some implemented in the OS (like unnecessary for loops) to counter the timing attacks. Modern smart cards contains logic to thwart the timing attacks wherein an external device sense the electromagnetic pulse generated around the smart card in the event of RSA operation to estimate the key involved in the operation.
- RFID or other modes of contactless protocols cannot be shut for privacy reason. The implementation can have mutual authentication protocol which will let the smart card OS first validate the authenticity of the terminal before engaging on the business operations like select Key and Sign operations.
Smart card are very much secured (In fact most secured element present to my knowledge); but like any other security infra, the real security depends on how the card was initialized, the operation of issuance of card, the standard followed etc.