Can pfSense be used as a router?

Absolutely! pfSense was designed to be a fully extensible security appliance to include routing and firewall protection just to name 2 features.

Yes* *It's original purpose is as an internet gateway / NAT router / edge device, but it is possible to set it up as a router-only device, although that setup is much more complicated than a dedicated router.

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Yes, buy its very nature it is routing packets from one network to another

The short answer is, "Yes", the long answer is more nuanced. Router devices typically have a lot of ports. Are you going to run it on a device with a lot of ports? Further, you might find a dedicated router device (possibly using pfSense internally) simpler to use than wading through all the pfSense options yourself. But if you like to know all the details, go for pfSense!

Yes. The machine that pfSense is installed on would need at least two network cards (NICs). One connected to your ISP device (external internet), and one connected to your internal network's switch. As traffic enters the first NIC, it is routed to the other NIC by pfSense's rules and settings (and vise versa).

Yes, of course. That's its primary purpose.

pfSense is an open-source firewall and router software distribution based on FreeBSD. It supports NAT and different types of interfaces (WAN, LAN, DMZ). It can absolutely work as a router, but you’ll want to dig into the details of what you need, and compare it to the features of this very powerful and extendable system.