1.I don't think it was ok for George to encourage Lennie to fight because George knows that Lennie is like a child.The other solution could it be to stop Curley. And the other solution can be to get Lennie away from the fight and talk to Curley to stop bugging Lennie.
2.For sure Lennie shouldn't be working because we know how is .Even though he is strong his mind is not mature enough to handle trouble.I don't think Lennie should be in a special institution maybe he would just stay home because away from society wouldn't help him develop his mind.
3.I don't think violence brings anything good but instead it brings hate, people fear of you and they don't like you.What Curley should is just treat them the way they deserve to.If they do bad things well they should get what they deserve.And he would still have the respect from the workers.
4.I don't think Curley's should be flirting with Slim or any guy. I said so because when she got married she promise to love only Curley and now she flirting with many other guys. I guess she can have "friends" from the workers but that is it.