1) I don't know if the WebFTP that's provided here has a built-in unzip function you can run on the server. If it does, then you could try that. OR log into your shell account here and use the 'unzip' command to unpack the archive. OR unzip it on your home computer and then upload them with your FTP program.
Doing it on your home computer might be easier so you'll have more local control. Your FTP program should be able to batch upload all that stuff by dragging it all from your local folder window to the remote folder window.
2) index.php is just as good.