The rich being imprisoned was never confirmed, it is just the best interpretation we have at the time.
As Magnar pointed out, it is after the eight year jump because Bruce has gray hair.
I believe it is a prison, but not a "real" prison. They are able to roam around because they are allowed to, simple as that. They must be locked up while they sleep of course, I'm sure they will have free time, but that is another discussion entirely.
I don't believe they are wearing L.O.S. attire at all. Look again, they look pretty normal to me, just ragged. Or, it could be and the men wanted to dress them in dirty rags. If they are the affluent in society, I can see this... Now, the people who are rappelling down,
they look like they are wearing L.O.S. attire.
Conti may know that language just because he knows that particular language. Simple as that. He doesn't have to be "in" with anyone.
Now, Magnar...
This place is not a duplicate of those steps in India, I do believe it is inspired by it but by no means a stand-in for it. I believe this place is in Gotham.
The Batcave is underground, Bane is getting around underground, Gordon and his men are underground going through the subway and other areas, there is a lot of underground stuff going on in this movie and I believe this place is underground. Perhaps part of the sewer system. OR, just like the Chand Baori (which is actually a well) this could be an old well. It would account for the well-like hole and tower on top and account for the strange step formation, which was used in India so that anyone could get to the water no matter how high it rose. Also, check out the picture again...
Look at the guy who is in the left corner, like he is reading the paper. See that big pipe running along the whole rest of the picture there? And look at where the water damage is...those yellowish colorings and drips. That supports that it could be apart of the sewer system or an old well.
But who knows... it could be in Timbuktu knowing Nolan.
Just, the best guess I think right now is in Gotham, underground, somewhere.