1. If I have meshfree shape functions that satisfy Kronecker-Delta, can I satisfy essential boundary conditions?

In fact, this is a common misconception with meshfree methods. Shape functions that satisfy Kronecker-Delta take a value of one at the node, and vanish at every other node in the domain. Finite element shape functions, for example, are usually designed with this property. This makes the satisfaction of essential boundary conditions relatively simple: we just set or fix the degree of freedom at the node to what it should be on the boundary. Unfortunately, this is usually not sufficient to impose essential boundary conditions with meshfree methods.

The issue is that meshfree shape functions associated with nodes located on the interior of the domain do not typically vanish on the boundary. So, what happens between nodes is just as important as what happens at the nodes. An excellent paper discussing the various options for imposing essential boundary conditions with meshfree methods is provided by Fernandez-Mendez and Huerta, Computer Methods in Applied Mechanics and Engineering, 193, pp. 1257-1275, 2004. At present, Nitsche's method is accepted as being the most robust for essential boundary conditions with meshfree methods. It should also be noted that with Natural-Neighbor interpolants, this is not an issue and the boundary conditions can be imposed just like they are with finite elements.