
Lune |

Lunge (Combat)
You can strike foes that would normally be out of reach.Prerequisites: Base attack bonus +6.
Benefit: You can increase the reach of your melee attacks by 5 feet until the end of your turn by taking a –2 penalty to your AC until your next turn. You must decide to use this ability before any attacks are made.
(bolding mine)
In answer to your questions:
By RAW you Lunge only lasts until the end of your turn even though the penalty to AC lasts until your next turn. Thus when you activate the feat on your turn your threatened area is reduced for when it is not your turn.
By RAW, this does not work.
IMO, this is silly. In our home games we allow it to work as the penalty lasts until your next turn so too should your bonus.

Dumb Paladin |

Since you do not actually increase your reach until you declare you are using Lunge, I think you would be hard-pressed to convince anyone that your threatened area should increase for an entire round. I certainly would say no.
Here's the problematic part of Lunge (emphasis mine):
You can increase the reach of your melee attacks by 5 feet until the end of your turn
Don't attacks of opportunity pretty much NOT happen on your turn? That's why they're attacks of opportunity, and not your standard or full attack.
There have been other threads on this topic; it is helpful to do searches before posting questions that might already have been addressed.