Yeah, another Brit. What else is there to say. It´s sad, but a fact.
No, concerned for their own safety, they alerted the police. If they were concerned of his safety, they would have approach, try to calm down and treat the man.
Nah, I think they are trying more to find out why he say he is afraid of the police. Something they actually do right in, as the man must have a screw or two loose.
Ok, you seem to have great knowledge about how the British Embassy work, as well as most other embassies. They do not pay for any trips home or anything else on their expense. So, calling the embassy will be totally useless.