1) If god knows everything about you, then why would he test you? He should already know how you would behave in any situation.
Witnessing is not about whether God knows, it's about whether the angels see. The testing for Job is not for God to know how much job can stand, but letting the angels to witness who Job is and how much he can stand.
The purpose of planet earth is not for God to know who we are, it is rather a stage for God to show the angels (and other chosen witnesses) who we are then to legitimately bring us (i.e., His Elect) to heaven. God on the other hand knows from the beginning who we are before the creation.
2) If god is all powerful, and evil exists, and god is benevolent, and caring, why does he do nothing to stop evil? God is also supposed to be a loving god, so he should and could prevent people from doing evil.
In God's plan, planet earth is never the final place. It's more like the filter of an aquarium. Earth is for evil to show up and be destroyed once and for all in order to secure a sinless Heaven. Heaven is the final goal. You shall see all kinds of evil here on earth, such that you won't be able to see any evil in Heaven. The same as you shall see all the dirty things in side the filter such that they won't pollute the aquarium.
Your questions have simple answers like these. My question on the other hand is why your intelligence failed to get to these simple answers to your question. If the intelligence of your kind is so unreliable, why do you still choose to use it to judge the situation which determines your own death or alive?
Earthly warning of Genesis:
Tree of Knowledge - the day you choose of eat of it, the same day you shall surely die!
Your kind are doomed! And your behavior was well predicted from the very beginning (i.e., Genesis)! Your relying on your intelligence (or rather stupidity) is the agent killing you!