Do players recover from fatigue when on the bench? Will pulled players be put back in when they have recovered?

If they do recover and reenter the game I could set lower fatigue levels for my deeper positions to allow rotation through the players, but if they don't come back in then that's not happening.

Yes, they recover while they are on the bench and will return when they are back above the threshold. The better their conditioning, the faster they recover.

Thanks