QIf this follower's Last Words is in effect while I have a reserved Athena on my field, does Athena take damage when an enemy follower attacks my leader?

AYes, it does.

QIf this follower's Last Words is in effect and my opponent attacks me with a follower that has Drain, I don't take damage, but does my opponent's leader gain life?

ANo. Drain only triggers when damage is dealt.

QIf this follower's Last Words is in effect, can I play Demonium, Punk Devil's activated ability?

ANo. You can't pay the cost, and therefore can't activate the ability.

QIf I play Fiery Embrace with Spellchain (10) and select an evolved enemy Yggdrasil, Root of Life, do I deal 3 damage to its leader?

AYes. Fiery Embrace's 3 damage will resolve before Yggdrasil, Root of Life's Last Words.

QThis follower's Last Words is in effect and my leader has more than 6 defense. If my opponent evolves a VI. Milteo, the Lovers, does its ability change my leader's defense to 6?

ANo, it doesn't.

QIf I deal 1 damage to my leader with an ability while this follower's Last Words is in effect, my leader doesn't take any damage, but does Sanguine still become active for me? Does it count toward the number of times my leader has lost defense this turn?

ANo, and no. Sanguine only becomes active for you if your leader actually loses defense during your turn.

QCan this follower attack engaged enemy followers?

ANo. "Enemies" refers to both enemy leaders and enemy followers.