In response to question #2, I'd say that you should try to level up Sabin, Edgar, Terra or Celes, and Locke.

Sabin is incredibly strong and has is very useful Blitz tech.

Edgar is also fairly strong and has the Tools command (which includes the very useful Chainsaw)

Terra and Celes are useful for magic and healing

And Locke is good because he can steal and can get the very powerful sword Illumina (which I think is the best weapon in the game)