Is sending data via UDP sockets on the same machine reliable?

No. I have been bitten by this before. You may wonder how it can possibly fail, but you'll run into issues of buffers of pending packets filling up, and consequently packets will be dropped. How the network subsystem drops packets is implementation-dependent and not specified anywhere.

In short, no. You shouldn't be making any assumptions about the order of data received on a UDP socket, even over localhost. It might work, it might not, and it's not guaranteed to.

No, there is no such guarantee, even with local sockets. If you want an IPC mechanism that guraantees in-order delivery you might look into using full-duplex pipes with popen(). This opens a pipe to the child process that either can read or write arbitrarily. It will guarantee in-order delivery and can be used with synchronous or asynchronous I/O (select() or poll()), depending on how you want to build the application.

On unix there are other options such as unix domain sockets or System V message queues (some of which may be faster) but reading/writing from a pipe is dead simple and works. As a bonus it's easy to test your server process because it is just reading and writing from Stdio.

On windows you could look into Named Pipes, which work somewhat differently from their unix namesake but are used for precisely this sort of interprocess communication.