1) Read drug literature, if you get your head right around Naked Lunch, the Illuminatus Trilogy and some of Philip K. Dick's wackier work they should tell you more or less everything you need to know. Burroughs is particularly useful because he wrote even though he was out of his head on drugs, not because he was out of his head on drugs.
The Illuminatus Trilogy is basically a compendium of the paranoid thoughts of every conspiracy loon that could be bothered to send letters on the subject of Civil Liberties to Playboy Magazine in the mid to late 60s (the book was written by the two editors in charge of that desk at Playboy and basically asks "what if all of this was true?"). One of the authors of the trilogy, Robert Anton Wilson, also wrote a book called Prometheus Rising which I believe depicts the internal landscape of someone whose done a lot of experimentation with hallucinogenics and pot and was exposed to much of the counter culture thinking of the 60s and 70s... he may have intended it to be the fanfare of a new era in human evolution but that doesn't do much to challenge my beliefs I suppose.
Philip K. Dick famously proclaimed both that he wrote his novels after taking large amounts of amphetamines and, later, that doctors had told him that his liver had processed the amphetamines before they had reached his brain (I'm personally unsure as to the medical viability of that prognosis but hey ho). Whatever the truth his work is fuelled by paranoia and filled with symbols of the broken or shattered sense of identity that altered states of consciousness produce.
2) The key to the most effective reality breakdown scenes is that they start out seeming realistically viable and slowly descend into madness. The path downwards is usually marked out with a strong set of symbols. As an author it is your job to convey a twisted worldview propped up by surreal dream logic and, I would argue, that the only way to communicate such a state of being to a rational audience is to be sober, disciplined and have everything meticulously planned. Of course the authors I mentioned in 1. often didn't but then the incoherence they sometimes displayed is testament to the fact that they were writing from within the fugue state and were trying to communicate about things they had discovered while within that state. You are trying to communicate the experiences of a third party experiencing that mental state. These two things are not the same; I believe what you are trying to do requires practiced application of technique.
3) If you want a laundry list of things to lean on then you might want to include:
- Bizarrely prosaic but nevertheless ominous and eerie symbolic repetition: follow the white rabbit Neo.
- Writing scenes out of sequence or introducing time loops: it's Groundhog day, again/Zed's dead baby
- Having characters snap from rational conversation into bluntly violent or sexual suggestion: Long live the new flesh.
- Suggest that reality is just a layer on top of something larger and more mysterious: The owls are not what they seem.
The most effective and creepy piece of writing I ever read was a story by an author who is probably completely unknown called Nicholas Antosca, a short story you won't be able to find anywhere called "Movies and Kids". In the story a young man pays a visit to his boss's house in a pleasant suburb of an unnamed American town. At the beginning of the story the narrator believes that there are kids running and playing in the hedgerows of these suburban houses although he cannot see them. When he goes into the house he is introduced to the boss's wife who, after exchanging a couple of pleasantries asks him if he likes movies. The narrator doesn't understand the question and suspecting it's some sort of innuendo tries to politely tell her he doesn't have much time for them. When his boss comes in and the two of them start pressuring him into committing to whether he likes movies or not he flees. Running through the streets of the suburb he believes he is being followed by the hidden children, laughing and playing, stalking through the hedges.
Nothing actually happens in the story but the author did a brilliant job of communicating paranoia and fear without ever resorting to traditional modes. Drugs were not mentioned but the technique of providing this kind of triple subtext, where there's what the audience knows, what the narrator knows and some possibility of underlying mystery is key to creating the atmosphere you're chasing.