Will menopause affect my diabetes?

Possibly. Menopause can cause a variety of metabolic changes including a general decline in sensitivity and secretion of insulin. These changes can worsen diabetes. Post-menopausal women also have a decline in metabolism making weight gain easier. So, continue to exercise regularly, eat a healthy diabetic diet, take prescribed medications, and meet regularly with your md to keep your diabetes controlled.
Yes. If you don't take hormone replacement, type ii diabetes can get worse. Insulin resistance worsens. The extent to which you have progressed in the diabetes continuum, will determine the amount of effect of menopause on diabetes. The further along you are, the smaller the effect. So if you are on Insulin you probably wouldn't notice as much change. To optimize, you need estrogen.