uBlock is a content filter. Cookies are set when a server responds to a web (http/https) request. So if uBlock has a domain blocked, not only are any cookies blocked, but no requests make it to that domain (whatever.com) at all.

If a domain is not blocked by uBlock Origin's filters, then cookies are set per your browser's configuration. Firefox I believe blocks some 3rd party tracking cookies by default, but can be configured to block all third-party cookies as well, but this may break site functionality like single sign-on.

I don't think it does anything with cookies directly. It just blocks connections to domains and removes elements from pages that match patterns you give it. Removing the cookies/privacy banners does just that - removes the banner. This SHOULD opt you out of tracking as the laws generally require explicit permission, so not clicking the accept button should be enough. But if the sites follow those laws or not is a completely different matter.

Third party tracking cookies are normally blocked by their domain - when a tracking pixel is on the screen it reaches out to a known tracking domain which logs this visit and drops a cookie for that domain on the page. By blocking that domain the tracking request is never made and thus no cookie is dropped and so there is nothing to track you. Most tracking is done like this so it is quite effective. But it wont stop a first party cookie from being dropped or tracking done through that or any other data you send.

Note that the laws don't require permission for all cookies. Ones that are essential to the sites function (like a cookie that carries login info) are typically allowed and cannot be opted out of (you can always delete cookies locally though, the laws just cover what sites can use). And not all sites will respect these laws or try to skirt around them so none of this is 100% perfect by any means.

uBlock doesn't block cookies directly but it can be setup to block the domains associated with cookies. Adding the EasyList Cookie will accomplish this. It will prevent websites from setting cookies when you visit them. As far as essential cookies go, I'd assume the Easylist blocks cookies which won't affect the websites function.

It eats them like cookie monster https://www.youtube.com/watch?v=Ye8mB6VsUHw

If cookie prompts annoy you (and why wouldn't they? Complicated and time wasting prompts caused by terrible and compromised legislation that's led to far more intrusion instead of enforcing use of browser settings) and you don't care about cookies, then the browser extension "I don't care about cookies" suppresses the vast majority.