Why is the solution of iron(II) sulfate made up in sulfuric acid rather than water?

There is a tendency for Fe²⁺(aq) ions to be oxidised by the oxygen in the air to Fe³⁺(aq) ions. The sulfuric acid helps to minimise this change.

What are the advantages of using a reduced scale titration?

Silver nitrate is expensive. A reduced scale titration uses much less materials than a more traditional method. There is also much less waste to dispose of at the end of the lesson.

Do I need special apparatus to carry out a reduced scale titration?

Small burettes are available but you can adapt a 2 cm³ graduated pipette to do the job. 

Could I make this experiment into an investigation?

Yes. You could ask students to find out how long it takes for equilibrium to be established. Different groups of students could all start with the same mixture but analyse it after leaving it for different lengths of time. They could plot a graph of the Ag⁺(aq) against time to find out when it reached a constant value.