How can I view MSIL / CIL generated by C# compiler? Why is it called assembly?

1. Yes it is, more exactly in the .text section of the PE file (portable executable = *.exe or *.dll). More information can be found here.
2. The best choice is to use ILSpy (Reflector is no longer free). It's a free disassembler that can dissassemble your assembly into MSIL but also C#, VB (to some extent). The .NET Framework SDK contains ILDasm, which is the official MSIL dissasembler.
3. Basically yes. An assembly is a file that contains MSIL code and corresponding metadata. This is not restricted to PE files per se, but all current CLR implementations use them.

If I may recommend a good book on that matter too, it's Expert .NET 2.0 IL Assembler by Serge Lidin. He's the guy who designed MSIL.

One of my favorite ways to see IL for a snippet of C# is to use the free LINQPad tool. After entering some code and choosing "C# statements" at the top (or "C# Program", whichever suits), click the "IL" button under the code entry area, and you will see the generated IL.

Using LINQPad for this is much more convenient than loading up Visual Studio or running the compiler from the command line, then loading up ILDASM and opening the .il file with a text editor.

If you want it online, .NET Fiddle is excellent. Just paste your code and click View IL option at the top right.