No it's not. It's entirely fanciful and completely imaginary. It's an aesthetic that relies wholly on anachronism. It's nearly the opposite of period-functional. It's ornamental.
Yup. Agreed. I read it as working outside the constraints of what a craftsman would have at the time. For example, building a steam based computer. The Difference Engine by William Gibson runs with that idea. Extends it to monitors and printers based on 19th century materials.
Building a knife using 19th century tools is not steampunk, it's just bladesmithing.