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Free badge.
You are mistaking the Seasonal badge for the Steam Summer sales event badge.
No.
You get 1 free card from purchasing $10 in games when the sale begins and until it ends.
Or crafting a game badge from now until the end of the sale.
Or doing a Discovery Queue once per day during the sale.
Or you get them from trading or purchasing them on the Market until August 11th when they expire.
You do not get 1000 XP for a badge, you get 100 XP for a crafted badge like always.
So 100 sets to craft badges will net you 10k XP. There is no limit how high you can craft the sales badge, there are some users with levels in the thousands on it.
Depends entirely on how much money you want to spend on the market.
There are also season badges on the points store you can buy which give 100xp for each level and cost 1000points for each level of the badge. Those go up to level 40.
And why do we want badges?