You have presented several questions, and some require more clarification to answer.
First, you can generally get a settlement from the insurance carriers by settling your case. But you do not recover for pain, suffering or the fact that you have 3 vertebrae fused together. The value of your case is based upon anticipated future medical care which includes future treatments (doctors and hospital), radiology and pharmaceutical. The value of the settlement is based on what your lawer can wrangle out of the carrier. In most cases this is just extrapolated based upon what is being spent on your case monthly, once any surgery was completed.
The problem in many cases is settling usually involves resigning from work and agreeing never to apply for employment again. If my client returns to a job they like and are capable of performing, settlement right away is not wise. I would rather they had the job. Also, if the injury is likely to result in additional surgery or if the client is using massive amounts of pain medication, settlement may not be wise. There are many reasons to think carefully about settlement, as it requires you to give up future medical care at their expense and resign your job.
You are right about some of your concerns about the FCE. Carriers use them largely to document the worker remains capable of a least sedentary work, so as to avoid the possible permanent, total disability claim. They have little to do with the impairment rating you were given, but if they surgically fused you at 3 levels the 3% rating can't be right.
If you were working at someone's home when you hurt your back, you cold go after the homeowners policy if you could prove the homeowners negligence resulted in your injury.
Malpractice claims are available if the doctors standard of care fell below the norm. If you are asking whether the adjusters delay, which resulted in a worse medical outcome is actionable, it is, but only under extreme circumstances. To my knowledge, the have been only one or 2 cases where the adjuster was actually sued over the handling of the claim, and in each case the adjuster had acted with malice and criminality. In the vast majority of cases the ajusters are immune from suit.