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I'll explain this by way of an example. Take A and B, who are both incoming associates at a tier-1 law firm. Both A and B are academically equal and also have similar demographic and economic backgrounds. The only difference between A and B is that A was quite avidly interested in the "social" aspect of law firms as well as the "work culture". A (mostly) hears horror stories about the work culture, about unreasonable and monstrous partners and is, for all intents and purposes, in a mental starting position that is some ways behind B.
B, in this case, while fairly cognizant that the atmosphere at a law firm can be high-pressure, and that work operates on deadlines that may be unreasonable at times, approaches his start in a mental place untarnished by perceptions and judgments not of his own making.
While A and B may join the firm at the same time, at the same position and, perhaps, quit at the same time, their experiences may vastly vary.
Take, for instance, the following instance. You are an A0 working on a transaction. At this time, your responsibilities will (broadly) include due diligence, proof-reading and research. Substantive drafting is still some ways off. Therefore, the chances for you to goof up (and goof up, you will) will be of no serious consequence. At this point, if you get told off (and you will be, make no mistake), you will be told off to ensure that you do not make mistakes, but more importantly, that making silly mistakes is a habit that is eradicated from your end, because the stakes only get higher going forward.
What is my point, you ask? Simple - it is, as it has always been, a matter of perception. I acknowledge that this could be offset by people who are genuinely atrocious, but they exist everywhere. Change your perception, and you'll win anywhere, anyway, any day, even if you do quit (because then, my friend, you'll quit on your own terms).
Having set this background (and I do apologise for the long wall of text), here's my answer to your question.
(a) Moving to an in-house job is going to be fairly challenging, unless you make the move within six to twelve months of joining a firm. However, making such a move would be pointless, because you'd have barely learnt much to assist you as a lawyer, in-house or retainer at a firm notwithstanding. Most in-house teams which would match your pay hire at lower levels (ICICI's corporate legal group being the best example that comes to mind, if you're in the BFSI sector). To be an attractive candidate at a mid-to-senior level for a company's in-house team, you'd need to have three to four years of law firm experience. Therefore, my suggestion would be that you make the choice to go in-house right away. Or make your peace with a perceived law-firm work culture, set a target of four years, learn all you can, take the emotions out of the decision and make a move once you've achieved seniority / experience to make the transition as smooth as possible.
b) Working conditions, I say again, are a matter of perception. Attrition exists (more so in firms than in in-house teams, but that is easily explained by a smaller team size). What works for me may not work for you and vice versa. Not everybody likes everybody. Bear in mind, I am not, even for a moment, lessening the negative impact of, or condoning the atrocious behaviour of certain people at firms. My point, simply, is that a lot can change on how you perceive the situation you're in.
Hope this helps. Good luck.
Law firm working about 12 hours a day and 6-8 hours on most weekends. In house working about 6-7 hours a day and most weekends free. Which one would you choose? Press like for law firm, dislike for in-house.