Improved Shield Bash 5

The only benefit granted by Improved Shield Bash 5 is that it allows you to gain defense bonus from two shields at once.

You can attack with both shields, but this isn't a 'benefit': anyone with a weapon in both hands (and shields are weapons, since you can shield bash with them) can attack with both. Even if you don't have ISB5, you can attack with two shields if that's what you're carrying: you just won't get a defense bonus from both of them (you'll get one or none, depending on whether you have ISB's base mastery or not).

When attacking with two shields, you suffer the full penalties for attacking with two weapons: unlike Hafted Weapon Mastery 2, ISB2 does not reduce these penalties (if it did, it would say so).

Improved Shield Bash 9

In effect this is a weaker version of TWF4: the only real reason for taking this instead is if you don’t have TWF1.

Improved Shield Bash & Two Weapon Fighting

As noted above, you can attack with two shields without Improved Shield Bash. It's the defense of the shields you will miss out on.

However, Improved Shield Bash has no effect on the attack penalties you would suffer for dual wielding shields. You would take the normal attack penalties for fighting with two weapons (which would depend on whether you had Two Weapon Fighting, and whether the off-hand shield was a light weapon or not).

Improved Shield Bash and Bucklers

Q: Does a character with Improved Shield Bash retain the AC bonus of a Buckler when attacking with a weapon held in that hand?

Strictly by the RAW, no, but I'd allow it. The character would still suffer the usual -1 attack penalty for attacking with the weapon while wearing a buckler.