It varies from seller to seller. I would imagine that there are some who are using fakes and not clearly marking that. They would hopefully be honest if you send a message to ask about whether it's all real, though.
It varies a lot - from junk to high end pieces. It is important to understand that Etsy is a marketplace, not a single store. Each shop on Etsy may have different policies, prices and product quality. I recommend contacting the seller you are interested in and asking plenty of questions.