You already got a bunch of answers for the drug test (which I support that idea, and please give us an update!).
However for the parent competition bullshit, here's my two cents. (Before you consider it, please know that I do not know anything about your life other than what you have told me, this is merely a suggestion, please consider your own safety, and if you do seriously consider this talk to the school counselor that I will soon mention about this idea. Show them how determined you are to fix this, and how serious this is. They might be able to have family counseling and be able to fix this without anything else I suggested. ).
So my two cents are you might want to go to your school counselor and talk about this with them and see what they say, this is absolutely horrible what they are doing.
If that fails (this is like the nuclear option, last resort don't make this your first option to fix this), the next course of action that you can do is just not play their games. They give you $100 for good grades, don't accept it, they give you more presents you give them to your brother/sister or donate them to Toys for Tots. They don't show up to your games, you don't give a shit. Why do you even want these psychopaths there anyways? Hell if you have a game at the same time as your brother, cancel your own game to go watch your brother, so they cannot go to your game at all. Now with you rejecting the carrots comes the stick, no car, no internet, no tv, etc. Fine, you deal with that shit. There's children out there who walk ten miles to work in a sweat shop, you can survive without this crap. Don't be mean, don't be antagonistic, just politely and calmly refuse to play these manipulative games. You only have power over yourself, no one else does. The only way they can is if you give them your power, if you refuse to do so it is you who is empowered not them.
Your parents are cowards and they will probably strike back on your refusal to play their games. If they tell you to do chores you do them because you want to and you want to live in a clean home, not because they have power over you. You do these things for yourself. You keep studying, you keep a clean room, you go to your games or whatever, live a normal life but on your terms. They are probably going to try and up the ante and perhaps make you do crazy and possibly dangerous thing. If so that is where you ask them "how far are you willing to take this?"
You mentioned you were afraid of sitting down with them, but you need to do this. These people are fucking nuts. If you want write down with dates every manipulative thing they have ever done and bring the paper with you, meditate before confronting them, calm yourself, find peace, it'll be over soon. There's nothing to fear. Don't cry don't show any signs of weakness, you have no weakness because you have the power now. You let them know that what they are doing is cowardly, unethical and evil. You do not do this to the people you love. You tell them this because you love them and your siblings and yourself. You cannot standby and let this continue to happen to them.
You are not their property and you cannot let this suffering continue and continue to your sister, and so on. You are your sister's protector and role model for better or for worse, you owe it to her and yourself that you fix this problem with your parents.
If your family at the beginning asks you why you don't want the $100 or whatever you tell them to their face. You explain all the incidents how manipulative it is and how evil it is to do this to your own family. Tell them you are prepared to accept the consequences and that you have no fear of them.
With regards as to why Kyle did this, I don't know and neither do you. There is nothing to gain by knowing why he did this. Will this bring you peace? I don't think so, you must move on and not dwindle on the past, for it will only bring suffering. You are a strong person, and a just person I have faith in you to right this wrong by any means necessary.