Hey Nandu,
I am unsure about your setup (on-demand/on-premise/customizations) but you can try the following if you haven't got another option to make this work.
For #1: have you tried generating a silent order? In the supplier location supplement, try using "silent" in place of URL for order method if this is not generating a silent order get in touch with ariba support to get help on the same. Also, if you are using ERPOrder you can write some logic based on DPAS_RATED" flag and ensure that the order is always stuck in ordering.
For#2: Yes that is correct
For #3: Looks like you are doing budgeting in Ariba, based on your setup you might find a solution in the link given below:
http://exchange.ariba.com/message/5821
Regards
Vilas