1. Why so many receiving addresses?
Why not? Satoshi recommended a new address for every transaction.
And can I use any one of them to send btc's to?
Yes.
I just download the program, set it up (make password etc...), and it says I am free to trade. So that is all I do?
As long as you've made sure to store a copy of the seed somewhere safe, yes.
3. I am wanting to go to bitinstant.com and make a cash deposit at a walmart or whatever,
Good luck with that. I've seen a lot of comments from people who have had issues with BitInstant and their funding method.
go back home to computer and when they show in my wallet I am then free to use the coins, and they should be in my /wallet pretty quickly?....
Assuming BitInstant doesn't encounter any issues, yes.
I Go to to bitinstant.com and set up the transaction & tell them where I am gonna deposit right?
Yes.
Then i'll go to the store find out who to talk to there and make payment and give them one of the 5 receiving addresses from wallet program right?
No, I don't think so. I think you set up the receiving address on the BitInstant website before you go to the store.
Then I send the coins from the electrum wallet program to the place I want to spend btc's right? and can so do in whatever increments I choose? It doesn't have to be all or none or make you keep a min. balance?
Correct.
Is there any fee for the transferring of the coins from my wallet to other sites that I have an account with,
I'm not sure if Electrum has been updated to use the newest fee structure. It will either be 0.0001 BTC or 0.0005 BTC per transacion for most transactions. If the conditions are right, it may be possible to avoid the transaction fee entirely.
4. WHat's the catch? (if any) .
Catch? Be careful to store your seed somewhere safe. Keep malware off the computer that stores your bitcoins. Beware of scams that attempt to relieve you of your bitcoins. Trust no one.
Are there any hidden restricitions or things that I should know?
The transaction fee is based on the size of the transaction in bytes. If any output in the transaction is less than 0.01 BTC, if the transaction is larger than 10 kilobytes, or if the priority is less than 57,600,000 then a fee of at least 0.0001 BTC per kilobyte will be required. Otherwise, you can usually send the transaction for free if you're willing to wait for a while for confirmations. Don't trust a transaction with 0 confirmations anymore than you'd trust a written check.
Or what can I do to prevent giving the bitinstant people a buncha my money and then learn that due to whatever detail(s), I now will not be able to spend my coins or get them back to cash etc.... then later finding that I could have avoided the weeks of phone tag and emails trying to dispute my lost coins etc... etc...
Best way to be sure to avoid that is to avoid using BitInstant. Otherwise, make sure that you don't enter any numbers incorrectly, and don't try to circumvent their maximum limit by doubling up two identical transactions in immediate succession (it seems to trigger some sort of automated fraud detection)
