Questions on backwards compatibility of Firefox Addons/Extensions?

You have to distinguish between "traditional" extensions and extensions built with the Add-on SDK . The former are far more powerful given that they have direct access to all APIs the browser uses - but that's also the reason why they are more complicated to write and why the documentation is rather unordered (there are simply very many things that you could do, far more than you could with Chrome). They are also more likely to break as the browser changes.

The Add-on SDK on the other hand gives you a limited API much like Chrome. The Add-on SDK currently supports everything from Firefox 4 onwards (yes, because of restartless installation), with the promise that browser changes will merely require your add-on to be recompiled with a newer version of the Add-on SDK. In fact, that recompiling will likely happen automatically in future for add-ons hosted on addons.mozilla.org.

On to your questions.

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