You can only design interface of web site not fuctionality. This will give you visual idea what your page will look like. It is always good practice to put each element on separate layer.
You can use ImageReady to slice your design up into separate image files and it will also build the html file which pieces it back together for a webpage. (although some changes usually need to be made to the code afterwards)
Yes you can even though i wouldnt suggest it. Load times are increased, backgrounds arent colours but images (even just plain white)... plus, imagine updating it, probably re-upload the entire site
sitegrinder/, never used it, but have seen a couple of sites done with it. not half bad
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