On a commercial garbage disposal w/water connection, is a vacuum breaker still allowed?

Yes, it is. Remember that it must be 6" above the flood level of the rim of the sink it's attached to. If the sink has a backsplash, sidesplash, etc all around it, it must be 6" above everything. The only other options for protection are an air gap or RP on the water supply.

There is a single check/Y-strainer device plumbed in-line with a domestic hot water recirculation loop. Is this allowed?

Because you are dealing with domestic hot water, there is no requirement for backflow protection. If a backflow situation were to occur, you would only have potable domestic hot water going back into potable domestic cold water. The check valve is there simply to stop the hot water from backing up into the cold water.

What are the legal ramifications if the fire backflow valve is not tested annually?

We are not sure if you are a water customer or a water purveyor, but the list below actually covers both.

There could be several ramifications:

1) You are not complying with State of Illinois Plumbing Code and Illinois EPA guidelines
2) You may contaminate not only the water within the building, but your distribution system as well if there is a reduction or loss of pressure, such as: nearby fire, water main break, etc.
3) You are creating a potential health hazard by not requiring or having the backflow preventers tested annually. Fire system water is not only stagnant, it may contain harmful chemicals (antifreeze).
4) You, the water purveyor and/or water user, may be liable for a clean-up of the water distribution system, the health of all water customers who were exposed to potentially contaminated water, etc
5) You can and WILL receive fines that may be imposed by several authorities, such as the Illinois Department of Public Health, The IEPA, etc