Are you using one of the market versions, or which one?
1. The option to turn it off already exists in both market releases. Turn it off, or take it up with android if you don't want to look at it, because android requires services which provide a persistent function (example, our functionality which relies on reacting to every screen off event) to be present as a notification. This is addressed profusely in our documentation. Here's a link to the explanation of requirements for apps that run in background.
Android Developers Blog: Service API changes starting with Android 2.0
2. The prefs all have explanations of exactly what they change. If you don't want any timeout sleep, you check keep screen and keypad on. If you don't want persistent settings icon, you uncheck that. If you use a pattern mode and want the custom lockscreen to come up first, you check that. If you want it to start up after you reboot once you have unlocked it to start using the phone, you check that.
3. For the level of options available in these releases, I feel like the options are explained as well as they can be in one sentence. A help/how-to wizard is planned for later release. What you're looking at here is beta quality for the purpose of finding bugs and app conflicts so we can make it better for free. We do it this way to avoid being that company that tries to get people to shell out 5 bucks for unfinished software so they can finish it.
I'd like your feedback of a more effective explanation for any option that fits in the same space, I'll put it in immediately if you provide it. This is how I'm driving the project, totally open source. I want it to be a product of other people's suggestions and ideally their own contributions to design, code, art, etc. Open source means anyone and everyone can contribute and then benefit from the result.