We present the results of theoretical and experimental studies of dispersively coupled (or 'membrane in the middle') optomechanical systems. We calculate the linear optical properties of a high finesse cavity containing a thin dielectric membrane. We focus on the cavity's transmission, reflection and finesse as a function of the membrane's position along the cavity axis and as a function of its optical loss. We compare these calculations with measurements and find excellent agreement in cavities with empty-cavity finesses in the range 104–105. The imaginary part of the membrane's index of refraction is found to be ~10−4. We calculate the laser cooling performance of this system, with a particular focus on the less-intuitive regime in which photons 'tunnel' through the membrane on a timescale comparable to the membrane's period of oscillation. Lastly, we present calculations of quantum non-demolition measurements of the membrane's phonon number in the low signal-to-noise regime where the phonon lifetime is comparable to the QND readout time.