DreamHost doesn't use cPanel or WHM, they use their own custom Web control panel, but rest assured you will still be able to manage your domains via this panel.
You can create a WebID and check out some of the features the Web panel offers, before you decide whether to sign-up, by clicking the 'LOG IN' text in the top right hand corner of the DreamHost homepage.
The one-year and two-year payment options are definitely prepaid, multiply the monthly amount by 12 or 24 to obtain the full cost. I think they show the equivalent monthly figure to demonstrate the discount that pre-paying provides (over monthly payments). The full cost is of-course shown during the sign-up process.
No, you have the option to not register the free domain during the sign-up process and register it at a later time.
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