Why can an engine working under isothermal conditions produce no useful work?
Answer
We know that $\eta=1-\frac{\text{T}_2}{\text{T}_1}$ For isothermal operation of the engine, $\text{T}_1=\text{T}_2$ So, $\eta=0$ Hence an engine working under isothermal condition can do no useful work.
When a gas expands, it does work on the surroundings. This work is done on the expense of internal energy and that is why its internal energy and so its temperature decreases.
Why can a Carnot's engine not get 100% efficiency?
Answer
Due to transmission loss, the energy required to carry the process itself and the inability to build a sink at zero kelvin, one cannot get 100% efficient Carnot's engine.
According to first law of thermodynamics when some quantity of heat (dQ) is supplied to a system capable of doing external work, then quantity of heat absorbed by the system (dQ) is equal to sum of increase in internal energy of system (dU) due to rise in temperature and external work done by system (dW) in expansion i.e. dQ = dU + dW