They won't cash out on them or buy items. Instead, they'll collect cards from a source (skimming, hacking, whatever), validate them by adding them to a website that does an authorization (those $1 checks that never get committed). They can then sell them wholesale for a premium compared to non-verified cards.
I've been away from that world for a while but remember that more serious operations will separate the cashing out part (either money or goods) from their acquiring / validating operation because the former carries more risk.
There's also an interesting episode of the darknet diaries podcast (https://darknetdiaries.com/episode/85/) about card cloning which I found interesting.
Not necessarily. Some online services, particularly shops that do home delivery, may give their customers the possibility of adding a card to their wallet and perform a verification as part of the process. As a result, it becomes possible to validate a stolen card number without performing an actual transaction.
The most amusing to me are the ones from “Microsoft” to alert me that they have detected malware on my computer.
To be clear, "validating" is an industry euphemism for stealing, just for a different purpose. How do you validate the card is live? Run a real transaction through it and mark it based on the result. But what do you run for this real transaction? Well, whatever you want. Typically it'll be something to avoid suspicion as much as possible, but the thief gets to pick what they test it with, so why not pick something that they'll personally benefit from? There are so many online games with purchasable currency these days, it's hard to choose.