(Obsolete) OneClick is a plugin which allows you to install plugins and themes from zip files on your disk, zip file urls, or Firefox.
Usually, no. But certain hosts may change the default CHMOD value and you may have to change it.
Yes, you may accidentally install malicious code because it's no longer a long process to install. The best workaround for this is to be careful of what you click on, and if you're the owner of a big blog, be sure to test the plugin you're installing on a local machine, and then use the file upload system of oneclick to install the plugin.
No, but if you want to help localize, send an email to anirudh at anirudhsanjeev.org