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This article will help with that: https://www.gardeningknowhow.com/ornamental/shrubs/lilac/pruning-lilac-bushes-when-to-trim-lilac-bushes.htm

The soil may be low on nitrogen. Nitrogen is responsible for growing foliage on plants. I would have the soil tested to see what it is lacking. In the meantime, composted manure is a good source of nitrogen.

To answer your second question first, lilacs don't need much fertilizer. This article will tell you more about lilacs: https://www.gardeningknowhow.com/ornamental/shrubs/lilac/lilac-care-growing-and-planting-lilac-bush-plants.htm
Regarding changing color, it's not unknown for the color to fade because of incorrect pH. Lilacs prefer soil that is slightly alkaline. A light application of lime once a year should help, but you might want to get a soil test just to make sure.

This article will help: https://www.gardeningknowhow.com/ornamental/shrubs/lilac/lilac-bush-not-blooming.htm

Lilac roots will grow into sewer lines, depending on the variety you have. For example, shrubs usually have more shallow root systems than tree forms. The roots will follow the path of least resistance where water, air and nutrients exist. Planting the lilacs 8 to10 feet away from the sewer line should be more than enough distance. As a general rule tree roots will extend up to 2. 5 times the height of the tree, and some species of trees may have roots extending five to seven times the height of the tree.

Because you mention mushroom-like growth, I would suspect a fungus is the issue, possibly one affecting the roots of the plant. Treat the lilac with a fungicide and then water the ground around the bush with fungicide laced water. Make sure that the drainage around the roots is good and that the plant is not in standing water. Then, give the plant some bone meal to provide phosphorous. This will help the plant regrow its roots if there was damage from a fungus. Also, cut off any dead or infected growth.