Are you sure you specified the new user as the "FTP user / CGI-runs-as user:" when you added the domain? If you did, you should see the web-directory for the sub-domain in that users home-directory, as well as the logs and maildir directories. As I said, this web-directory will by default have the same name as the sub-domain (ie: username.site.com), this is where the publicly accessible site files for the sub-domain must be uploaded to.
It does take some time for a sub-domain to become fully usable, but this is generally shorter than the time taken for a full domain.
No, unless you specified the admin user as the "FTP user / CGI-runs-as user:" when adding the sub-domain.
Save [color=#CC0000]$50[/color] on DreamHost plans using [color=#CC0000]PRICESLASH[/color] promo code (Click for DreamHost promo code details)