Need high level directory structure recommendations

I have so many questions, I’m not sure where to start. I have tried to find documentation about the directory structure and purposes of each for WP, but the documentation appears to be more about designing a specific page vs. an overview.

Technically, I know enough to be dangerous. With sample code, I can usually modify it, but I would not be able to create it “from scratch”.

Hosted setup that I would like:

Home page website with 3 columns, header, and footer. I would like the middle section to be a blog.

Then, I want separate blogs/databases for subdomains, where the link goes again to the same website structure around the middle section, but the middle section of each subdomain will be a different blog.

My first draft of the site for over 200 pages was in 2002 with FrontPage (with no blog)!

Due to the 200 pages, someone showed me Server Side Includes (SSI) and I got the skeleton to work with .shtml.

Now, technology has jumped, yet again, so I have a skeleton with PHP Includes for common structure.

WP has had a different version each time, as well.

***My 20,000 foot questions – how should my directories/subdirectories be structured for the home page vs. the subdomains? What should be in the WP directories vs. external to those (e.g., images)? How/where are directories/subdirectories specified in the WP install files? Would the middle blog section work within a “myinclude.php” unique to each subdirectory?

I downloaded 2.3.3, unzipped it, and uploaded it at the root for each subdomain (in Unix).

I also uploaded it at the root for the home page.

After those “vanilla” uploads, I uploaded my “custom” files, including the Logo and the myinclude.php files.

I also uploaded the same index.php to the home and the subdomain directories, with the intent of modifying it to be specific to each.

I did modify the wp-config.php file for each to have the correct database name (unique for each subdomain and home page), userID, and password.

***What additional changes need to be made and where for WP to work as separate installations with separate databases for home and each subdomain? Do I need to do separate “installs” for each subdomain, as well?

And, of course, I get the unable to login due to cookies blocked error message. Yet, I have even tried allowing *all* cookies/lowest security and also terminated any security applications (except Google toolbar-could that be the problem or MS’s security updates?) and still can’t login.