Your example should be "My car is as fast as a bullet". It simply expresses equality e.g. in the example above, you're saying that the speed of your car is the same as that of a bullet. If you said "Bill is as tall as Mary", then you're saying that Bill and Mary are the same height.

You use it to compare equal things. You can't say "my is as FASTER as a bullet" It has to be equally fast. "My car is as fast as a bullet" Or if two boys are the same age, you can say "he is as old as the other one"

Same as what others have said. Another example is :as cold as ice'. If you say something like 'my hands are as cold as ice' it means your hands are very cold. But if you say, for example, a person is as cold as ice, it means they are dangerously cold or they don't have feelings or emotions and dont seem to care about people. So it can mean a physical or emotional thing in this context. I hope this helps.