1. Is it safe to travel in the areas mentioned above?
Yes. very safe.
2. what are the places to visit in gilgit and skardu ?
In skardu, dont miss Deosai, upper kachura lake and lower kachura (aka shangrilla) lake, Shiger valley.
In Gilgit, dont miss Hunza, Khunjerab, Naltar, Shandur, Phander and Yasin valley. If want some more, also add Ishkoman valley, Nagar, hoper and Shimshal etc.
3. what is the total amount required for 7 persons ?
If u have ur own transport, the expenditure wont be too much. It would be hardly 1k per day per person.
4. is it possible to visit kashgar city of china with temporary passes if yes then where to get those passes ?
No. visa is required
5. is diesel easily available through out our journey or not?
Diesel is available, but filling stations are not very frequent. It is advisable that u keep some container of 5-10 litre as reserve.
6. what are the condition of the roads.
KKH is quite ok. Gilgit shandur was also not bad some years ago. rest just satisfactory or quite bad at few places. But, definitely u are not going in some comfort zone.
7.what do u think which tools and oils of jeep will be necesary on the trip ?
Tyre puncture kit, portable air compressor. rest a mechanic can advise better.
Any detailed information regarding tourist places/expenses/hotels would be highly appreciated.
At most of the places, there a lot of hotels and u wont find enough tourists (unlike Naran, Kalam, Shogran etc). So no need to worry about this aspect. U will get accommodation at almost every place very easily.