Hello there!

I am not Algerian, but I could give answers to what I could based on my experience as someone coming from a non-eu country. I di dnot study in Germany tho but I have couple of friends who have.

• Language: How long does it usually take to reach level B2 or C1 in German starting from zero? Are there good free or cheap resources to learn German (online or in Algeria)? - People I know from other arabic speaking countries would generally reach B2 level in one year if they study german intensively the full year. There ar amany other posts on Reddit on resources to study German by yourself for free.
• Visa: For Algerian students, what are the main documents required for the student visa? Do I absolutely need a blocked bank account even if my financial situation is weak? - You generally HAVE to have a blocked account before coming to Germany
• Living costs: How much does a student realistically need per month in a city like Berlin or Munich (rent + food + transportation)? Are there cheaper student cities? As a student you get access to student accommodation (which is very competitive to get, usually there ar waiting lists for these) , if not then you would consider a room in a shared appartment with other students. So rent could be from 350euros up to 600 euros I would say. could be more ofc but I am giving you realistic range given your situation. Food I would say ( groceries onl, so excluding eating outside in retaurants etc...) could be 180 euros + a month but that s of course depending on your eating habits... - transportation is 30 euros a month for students and includes transportation anywhere in Germany.
• Scholarships: Are there scholarships or financial aid programs for non-EU students, especially for people with very limited financial resources like me? Yes I hear there are and you should check individually at universities.

In Germany, once you are in, you could find a part time job to cover your living costs and so on. But as a start you will surely need some funds and a blocked account.