Yes, numbers for icons are given in kilometers. So .10 km is 100 meters.
JTD was joking when he was talking about online players...they always seem to be better than you
Convergence is important, but it's not the magic answer. To get good at shooting, you have to practice. I'm really bad at gunnery myself, so I can't give you feedback there. If you recorded a track, maybe someone can analyze it and give you tips.
To find a convergence that works for you, turn on icons in the difficulty menu. Go into the controls menu and set a key for "toggle icons". Set up a game in the quick mission builder with your favorite plane and some enemies and when flying, cycle the icons until they disappear.
Right as you pull the trigger to shoot, pause the game, and toggle the icons back on, and note the distance. Do this each time you shoot, and make an average. This is YOUR best convergence.
Online, this might be different because human players present different opportunities to shoot. In that case, fly with icons on if possible, but try to ignore them. Record a track and note later when you start to shoot.
My convergence is 200, but I've used 100 with great success. I like to use 700-1000 for ground attack (Il-2, Hs-129, Stuka G-1, etc).
To answer your other questions: 2) Normal, Normal 3) Mouse
4) 10,20,30,40....100 all axes; 2-3 notches of filtering to kill the spikes.