Is it correct to use "would" with stative verbs? I have seen many constructions such as "would prefer". Please elaborate on it.
I have learned that we can't use "ing" form of verb with stative verbs, but I hear native speakers use it almost everyday like "You are being rude", and "He is being too honest", etc. please explain this as well.
You will do better to think of 'verbs being used in a stative sense' rather than 'stative verbs'.
He is handsome. Stative use.
He is being silly (=behaving in a silly manner). Dynamic use.
'Would' can be used with verbs in stative and non-stative senses.