A good step-by-step guide to affiliate publishing is the James Martell Affiliate Handbook. It will answer pretty much most of the questions you have posted and it is geared towards those who have no idea about the business. There is a cost for it but it is well worth it. It got me started in the affiliate business.
Everything he talks about can be found on the net for free but it would take you months of research and effort to find it and there is so much conflicting advice on the net. Its a step-by-step guide to setting up an affiliate website.
You can read a review I have written for his manual by clicking the link in my signature below and you can download free the first 35 pages of it to get an idea. Otherwise just type in "James Martell handbook" in Google to find more info.
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