

The ultimate extraction would likely be achieved with high proof alcohol. Sugar syrup I think would be less effective than with dry sugar as the dry sugar would exert more osmotic pressure on the tips to draw liquid (and thus flavor) out of the tips.
You can also add them to the boil as you would hops.
It’s not illegal in the US for homebrewers, it would be for a commercial brewery (though they can buy vanilla extract which uses alcohol for the extraction and use that with no issues), in reality no one is checking this stuff and there’s probably a lot a commercial brewery can get away with that is technically illegal, just put spruce tips on the label, no one cares/asks how it was extracted.