Here are some of my thoughts:
1) This market is really rough. But if you were underplaced to begin with and you've kicked butt where you are, you can definitely move up.
2) The move should happen pre-tenure or else it's exceedingly unlikely.
3) As social psych said, all of the above! I'd say you need pubsat least onefrom your time as PI (i.e. work that you started at your SLAC and completed there), because it shows your independence in a way that sharing authorship with your postdoc or grad advisor does not. You also really ought to have a grant. For an R2 you might not need a grant, but that one factor will make a huge impact. If you previously held an NRSA or something along those lines that will help, though. A current grant is best but a previous one is good.
4) This really depends on the people you work with, the institution, etc. A lot of people are moving around these days because academia is on rocky footing. For example, with Sweet Briar College closing this week, anyone at a SLAC can make a good case for looking around (though if yours is a pretty wealthy slac people at your school will give you the side-eye for that reason/excuse.) You basically need to find someone you trust who is supportive. Otherwise, keep the whole thing a secret. If your school is having financial or other issues (e.g. a toxic dept), then people will fully encourage your applications. If everything is hunky dory, find someone you trust who heavily values research and ambition, and would therefore approve of your looking around, because no one else will in general; people just don't do that so much from SLACs.
5) It's helpful to have one letter from your institution if you can tell one person you're applying. It's also helpful to have that person be your department chair, but use your judgment if this person isn't the right person to be involved. If you can't get a letter from your institution, you'll need a more up-to-date letter than just your graduate/post-doc advisor, such as someone in the field who knows your work. After all, your research should be strong enough that someone like this could be able to write a letter for you. If you're not in this position yet, you should start trying to do some non-institutional service or strike up a collaboration so that someone on the outside could write a letter the next year.
6) This is really up to you and what your preferences/skills are. One obvious one might be that at a lot of second tier R1s and even R2s, the class sizes are very big (50-400), whereas at your SLAC you've probably had 10-20 students a lot of the time. If you're not used to lecturing, you might have to get used to it, and you might in turn have many students banging down your door. If you've become accustomed to great pedagogical practices that work in smaller classrooms you might be disappointed about the sacrifices you need to make in this regard.
7) My advice is that make sure you always do your current job full out; that way no one can ever accuse you of having one foot out the door. Carry things out as though you're there forever (because in all likelihood you are). Be good in your service and an excellent team player. No selfishness. Applying takes time and energy away from your job, but try, then, to make that be your leisure time. That said, even if you do this, you might still face repercussions. Some people will never truly forgive you for it. They don't have to find out, but it can be hard to hide, too. Some people might also be jealous (e.g. if you get a job and turn it down and stay, and they find out about it.) But again, if you're doing excellent work, people will have to engage in deep cognitive dissonance to hat you for it.