From what I’ve read in books written by the principal people of that era, the “1202” error was actually a problem of data overload, which caused the onboard computer to miss its processing time targets. Luckily, one of the ground staff had seen the error in simulation tests, and knew what it was and why it was occurring. The cause was determined to be from the radar system’s data, an early case of “TMI” as we now know it. The solution was to turn off the radar, forcing Armstrong to manually fly the lander at the end.
And the countdown you hear on the audio isn’t really how much fuel was actually left, but more the time left until the fuel supply was low enough that an abort and return to the command module would be indicated to avoid Eagle’s being stranded on the moon. The added fuel usage was due to the terrain problem and Armstrong’s need to reposition landing to something better suited. I believe they added more fuel to later flights to be prepared for similar situations.
No. The countdown was remaining fuel. Armstrong was manually flying and was going to put it down no matter what. There was not enough fuel to abort the entire LEM. There were only a few seconds left of fuel.