Gear pumps are typically a limitation in Flow. While you may have rotating regions in Flow Simulation, any two regions must not overlap or interfere (eg a gear pump).
You're probably looking at a moving-mesh problem and also looking to spend more $.
The failure criteria does not factor into the stress calculations. It's only used when defining the Factor of Safety plot.
There are, of course, different ways to define failure. Simulation uses four. By default, von Mises (distortion energy) criteria is used since it correlates best with...
Agreed, beams are most appropriate. However, if you insist up going down the solid route (use symmetry of course), then you can probably work around the mesh error.
"surface mesh is successful but the volume mesh has failed" indicates that the mesh tolerance was high enough to cause volume...