> Is it truely drop-in replacement as in "you can develop to MySQL, then run MariaDB in production without worrying"?
yes, unless you use some of the non-GPL extra features like e.g. authentication plugins or pool-of-threads. For these MariaDB has GPL replacements but the implementation and configuration may differ ...
> Does it require converting current tables?
Data format of MyISAM and InnoDB tables is the same, so "no" in general. mysql system database may differ a bit, but nothing the mysql_upgrade tool can't fix, and you'll have the same issues when develop against an older MySQL version and deploying to a newer one ...
> Will it take a 10GB database all day to convert or will MariaDB just use the raw MySQL data files automagically?
It will use existing raw files just fine. mysql_upgrade may take a few minutes max., but not all day ... (unless you're migrating from an older MySQL version and mysql_upgrade needs to recreate some indexes ... but that would happen when upgrading to a more current MySQL release, too, and wouldn't be MariaDB specific
The only point where it isn't a simple "try and revert if you don't like it" drop in replacement is if mysql_upgrade changed mysql.* system tables and you want to roll back to regular MySQL ... but then again this is also the case when trying to upgrade to a more recent MySQL release and then deciding to roll back to a previous older one again ... so you should always have a backup to restore the original system tables from ... but you'd do a full backup before any version migrations anyway, wouldn't you?