2. Do you mean something like this? $\displaystyle \text{Frau Frau}\kern1pt\setbox0=\hbox{en}\dimen0=\wd0 \advance\dimen0 by -1.75em\lower1.5pt\hbox to0pt{\kern-2.5pt\Large$\subset\kern\dimen0\supset $\hss}\box0$, $\displaystyle \text{Kind Kind}\kern1pt\setbox0=\hbox{er}\dimen0=\wd0 \advance\dimen0 by -1.75em\lower1.5pt\hbox to0pt{\kern-2.5pt\Large$\subset\kern\dimen0\supset $\hss}\box0$
As far as I know, TeX is not really set up to do that sort of thing, and you have to resort to messy improvisations. I once had to construct a macro for putting a circle round a number, and even that isn't straightforward. It would produce results like $\displaystyle \setbox0=\hbox{$3$}\dimen0=\wd0 \divide\dimen0 by 2 \advance\dimen0 by -8.5pt \lower0.6pt\hbox to0pt{\kern\dimen0\Large$\bigcirc$\hss}\box0$. But at least TeX provides a circle symbol. If you want an oval then you have to be creative. I constructed those above by overlapping the set inclusion symbols $\displaystyle \subset$ and $\displaystyle \supset$. That can sometimes be stretched to cover three letters, but there is a danger of a gap appearing, as in $\displaystyle \text{zwei}\kern1pt\setbox0=\hbox{mal}\dimen0=\wd0 \advance\dimen0 by -1.75em\lower1.5pt\hbox to0pt{\kern-2.5pt\Large$\subset\kern\dimen0\supset $\hss}\box0$.