Yes it is usable in rain - The antenna parameter would change if it's wet though - It applies not only but also for all antennas when they are getting wet.

You should revisit your counterpoise set up. A good counterpoise is important for M-104. If you are using radials as counterpoise, You can use them with supplied ring terminals - At least 1 radial is needed above 14MHz, and more than 3 radials is recommended on 7MHz.

Rest assured - It’s our unique design in the base and yes it will indicate as shorted if you use a multimeter to test the center and the shield. No worries it is not a defective unit.