RSS is an acronym for Really Simple Syndication and Rich Site Summary. It is an XML-based format for content distribution. In other words it is a format used to deliver information from websites and pages that get updated regularly. An RSS document (which is called feed) contains either a summary or the full content from a website.
They are all right this RSS term. But to make it short, RSS or RSS Feeds, are like news from your site. It gets updated regularly when you also update your site. Whenever you post a new article , it will automatically be posted to your RSS too.
1. Personally, I think installing add-on on your admin area for generating RSS feeds would be the most effective method.
2. RSS feeds submission to those RSS directories would be really helpful for increasing traffic purpose while you would be able to use your RSS feeds for backlinking purpose on some forums like v7n since such forums would support automatic blog updating via RSS feed.