General Availability: Microsoft Information Protection sensitivity labels in Teams/SharePoint sites

Sesha_Mani  I m in the middle of implementation au-labeling for SharePoint and Onedrive in our organization.  The following are the requirements. 

1. Documents must be classified automatically when a user uploads a document to the SharePoint site- Can do with Auto-labeling , already test 
2. Content marking - any document classified must stamp with watermarks, as my understanding, we cannot do with auto-labeling. Any way to achieve this?  or even why when a user downloads the auto-classified document to the computer the user cannot see watermarks that we have defined under labels? is this because auto labeling not opening the document when its stamp with the label? 
3. To overcome the 2nd issue I have tried with word templates, but then auto-labeling doesn't work with .doctx, will you be able to share a reference for all document types that support by the auto-labeling. Seems to be pdf also not supporting.

Thanks.