1. Yes.
2. I think most people probably get theirs from other sites. It's best not to use the ones that come with the game, unless you need something. It makes the game more original.
3. When the item is used, it turns on a switch.
4. There's a switch tutorial on this site, but basically a switch does exactly what it sounds like, it makes something happen or stop happening. Timer operations set up a countdown timer, and by trigger, I think you mean for the timer? It... actually I'm not sure.
5. Go to the String/Vocabulary tab in the database. You can change the name of many things there.
6. The title option, as far as I can tell, is not important at all. I don't think you could make races.... unless you used it just as the title. But, like I said, the title doesn't affect anything.
And for your friends question, no, the game will not mess up. You could start everyone out at 1 HP if you wanted to. Some people prefer games where the hero doesn't ever get much more than a few hundred HP, some people prefer the traditional Final Fantasy 9999 HP limit. It's up to you.