Basically yes. You can consider sheets a feature for visual grouping/ordering (+ effects), while layers are logical grouping.

Layers only end up important if you actually use them though. Having everything grouped according to feature, such as one layer for hills/mountain is nice and all, but if you never use the features layers provide (select by layer, hide layer, freeze layer) it becomes less important. I do find it useful to be able to select things like all the mountains though, for things like sorting symbols. While the layers doesn't themselves determine what goes on top of what, the ability they give you to select just the correct symbols is nice.

Layers are actually more important for the interlaces of the software than sheets though. For example, dungeon corridor tools rely on layers to figure out what is a floor and what is a wall when connecting to existing parts, cutting symbols rely on layers to align to and cut that wall when inserting a cutting door, and the edit feature of drawing tools relies on the layer to determine if this is an appropriate entity to edit, the background of the map is figured out from the BACKGROUND layer, and the extent of the map is determined by entities on the MAP BORDER layer to name some.

Usually though, tools set their own layer when you use them, so you don't really need to keep to much an eye on that yourself. If you create your own tools and symbols, you should always set up layer information so your own tools can also set layers automatically, but unless actively use your layers manually, it is usually just fine to then let the tools do their thing, but don't otherwise think too much about it.

Technically, yes. But normally, you'd find at least BACKGROUND, SYMBOLS, GRID, TEXT, SCREEN and MAP BORDER in all maps, as they are commonly used. Additionally, for a dungeon map, you would normally have at least FLOORS and WALLS.

Which sheets to include does depend a lot on the tools and symbols you want to use. If you make everything from scratch, you are pretty free since you then also configure this yourself on your tools and symbols, but if you want to be able to use tools and symbols from other styles, you should look at what they expect.

No. When a map is created from a template, that map copies the current template settings. It has no connection back to the original template, and changing the template will not affect any maps created from it.

If you have added new things to a template you wish to bring into an existing map, you can make a new blank map from that template, then in your existing map, use Draw -> Insert file, pick the blank map you just created, but once you have it on the cursor ready to place, just hit escape instead of going through placing it. This is enough to copy in all definitions to the map, including symbol definitions, fill styles and line styles. Note that it doesn't update existing definitions, it just copies new ones.

If you insert an fcw file into another using Draw -> Insert File, the line styles (along with fill styles and symbol definitions) will be copied over. Basically same trick as for copying over missing fill styles.

Keep in mind that line styles, just as fill styles, are on a per-map basis. It is not something that gets installed globally. This means that if you see a random option in the line style dialog or not, depends on if the template you started that had from had such a line style. It is not dependent on installing any particular annual or other product. These installations will never change anything in existing maps regarding line styles.

I have files from the CC2 era with this line style in them. (Check @Tutorials\UserManual\Selection.FCW)