A:AnswerThe MyCloud is connected to your wireless router via an ethernet cable to a plugin port on the router. Now your wireless devices connect to the MyCloud through the wireless router, then on the Ethernet cable to MyCloud.
A:AnswerYes, this works great with The XBOX One, I use it solely for Media purposes only though. I would not recommend it for using for game storage due to the fact that it is wireless.
A:AnswerYes. Typically at this point you would start to move the files that you use/access less frequent to the external drive, and leave the ones you regularly use on your computer. Typically a good idea to get a drive largest enough to back up your entire computer and have plenty of space left over for additional media.