Honestly, I just watched a screener of the movie tonight, paying close attention to the story, and I still don't quite get the ending. It comes out of left field. The whole movie makes a lot of sense until Nicholas Tse's involvement is revealed. To try and answer your question:
1. I'm pretty sure the the vanishing bullet scheme was concocted by Nicholas Tse. The factory owner and police chief didn't want there to be any murders at the factory because (A.) it caused the workers to go on strike out of fear and (B.) it created a scandal in the town and made the police look bad. However, Nicolas must have known the police chief was making a shady business deal with the factory owner - he figured if he could out them both and solve the vanishing bullet murders, then he would be able to become police chief himself.
As Lau Ching Wan says - whoever has the most to gain, is the culprit. Nicholas Tse went from being just another detective to the chief of police.
2. That was just a subplot to help humanize Lau Ching Wan's character...she's just the love interest and she's a smart woman so she helps Lau Ching Wan piece together the ending. He didn't want to believe that Nic Tse was guilty but the woman urged him to face the truth.
3. Nicolas Tse wanted the police chief out of the way so he could replace him. He probably didn't think much of the factory chief either way. The 'other police officer' I think you're referring to was the factory owner's right hand man, who Nicholas Tse served in the military with. Nicolas Tse used his fortune telling lover to give that guy his assassination assignments - which he enacted with the bone bullets. But the guy didn't know Nicolas Tse was the one giving him the hits.
4. Not sure where Lau Ching Wan's character comes from.
5. The sealed room is what confused me. I think what happened is that - Lau Ching Wan and the other 2 guys heard the gunshot. Lau Ching Wan assumed that the gunshot was timed for their benefit, i.e. the murderer waited for them to be near by before he killed the victim so they would hear the gunshot. Lau Ching Wan wondered: how did the killer know they were going to be there? His deduction was that Nicholas told the murderer when to commit the crime.
That last part is the one I'm the most sketchy on. I hope this helps some.
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