Easyfileshop enables you to sell files as downloads. Easyfileshop is easy to use and easy to integrate.
Yes, see Installation / Advanced Usage.
Yes, see Installation / Customization.
Yes, it is not needed. Paypal has all the payers data and will handle them to you after the checkout process. This is easy.
The plugin does not have a cart functionality. It is for cases, where you only want to sell one file at once. If you want to sell more files at once, you need to chose an other plugin.
Easyfileshop allows 3 download attempts in the first 30 days after the purchase. Then the download link is not valid anymore.
We have a serious problem. Maybe your wordpress installation is not reachable from outside because you are in a testing environment? Arround the "Buy Now!"-button you'll find a hidden field named notify-url. The url (ends with ...ipn.php) in the value attribute has to be available for paypal. If you open it in your browser, you shoeld see an empty white page without any error message.