Welcome to the forum, you ask a lot of questions...!
1) get the biggest you can afford, the smaller the compressor the shorter the time you can spray in one go. It's possible to spray with a pretty small compressor, but you'll need to do it a panel at a time (not a bad way to start if its a solid colour)
2) There are two types, suction feed and gravity feed - suction feed has paint tin on the bottom and sucks it up, gravity has paint on the top and it naturally flows into the gun, so it depends on 1). If you have a smaller compressor then gravity feed will probably be better.
3) Cellulose. 2k is dangerous stuff so stay away from it unless you can run an air-fed mask and have good extraction fans. Many top show cars have had cellulose paint jobs in the past. It's harder to get hold of these days, but still possible.
4) Depends on the body. Personally I like 1k synthetic primer, it doesn't sink like cellulose primer, but it's getting harder to find. You might also try an isocyanate free 2k primer, it's 2k paint so still dangerous - but the most harmful stuff is not in it. Some people go for a 'deep coat' but I've never liked that stuff, it can look good for a while and then sink a few weeks later.
5) polishing compound, you'll want to colour sand it after you've sprayed. Colour sanding brings back optimism after an otherwise disappointing result with the spray gun.
6) Get a black aerosol can and dust over the car (guide coat), then wet sand it with 600 or 800 paper until all the black is gone. If you still have 100% coverage of primer then you're good to go, otherwise you'll need to prime it and repeat guide coat/sand until its all ready. The end result will depend heavily on the preparation.
Work out what you can afford and work up to that. I've seen presentable paint jobs done completely with rattle cans and the other end of the scale is multi-thousand pound paint jobs, you choose what you want/can afford
Rob Amos
Happiness is a stock VW