You'll lose out on the "exact match" relevance boost. But the whole "exact match" thing is a little overrated anyways. If you have the majority of the keyword in the url, you will pick up a some LSI relevancy boost.

Although "exact match" is ideal. You can more than make up for it with a little SEO grunt work.

Both are worthless words to have in the domain. I made this mistake too once. "how" and "to" are both stop words meaning Google ignores them, same with words such as "and" "the" etc. Look up some info using Google search on Google stop words before making your domain.

It's not so much them being suspicious. More just stop words are ignored by Google. The reason for this is to reduce strain on their server, like I said have a read about what they're for.

Based on your suggestion I would just call it "great-cookies" or "making-great-cookies" there is no disadvantage to using a stop word so if you want to call it "how-to-make-great-cookies" go ahead however it's a bit long. Keep in mind the shorter and catcher the domain the more people who will remember it and come back. Make your domain for your users and yourself not Google. Pick one you like to be honest. I get loads of returning customers typing in my domain in my sig into Google looking for it because it's short and catchy. With my older domains which I soed for Google and not users this doesn't happen often.

Uhm... Google is smart enough to know the difference in definitions of to & two (2).

Just because it sounds the same to a human doesn't mean you can fool a bot into thinking they have the same meanings.