Yes it can update your feeds automatically if you do a cron job on this file “update-feeds.php” that is placed in wp-content/ or you can updated manually by going to this page.
For me all new posts go in the default category, if someone knows how to make feedwordpress place post in a certain predefined category I would highly apreciate it.
Have a nice day.
Here is a list http://wordpress.org/support/topic/32092/rss of different feed readers for WP and you can use http://metarss.com/info/blog/lang/en/ to generate a feed from your feeds to put on your site.
