Q. Isn't 16 inch tyres rather small for a big vehicle like Innova? Can I upgrade to a 235/55/17 inch tyres for Innova for smmoth, better ride?

Considering the Indian road conditions 14 inch tyres & the footprints are small. You cannot upgrade to the larger tyre / rim as you will lose the warranty & the odometer will show wrong reading. Even after the warranty period is over if you change the size of the tyre - Rim, in case of an accident the insurance company will refuse any compensation. Lastly, it’s against the Motor Vehicles Act to change / alter any specifications of the vehicle without the consent of the authorities.

Yes , you can upgrade the alloys but according to me don't change the size of the alloys as in the company there are hundred's of Engineers who decide the size of alloys so to get the best performance from the vehicle they give the alloys

Mostly yes, not sure