Q3: How do I reduce the fat covering my middle?

The answer comes in two parts: diet and aerobic exercise.

DIET

This is controversial, but most people agree that eating very little fat and lots of complex carbs (like rice, pasta and potatoes) helps ensure that you don't add additional fat. Then you have to work at using the fat you already have stored which involves...

EXERCISE

Again a bit controversial, but it's widely agreed that regular, moderate, aerobic exercise 3-4 times per week works best to burn fat that's already stored.

"Moderate" because intense exercise burns glycogen not fat, so keep the intensity at about the level where you are beginning to puff a little.

"Aerobic" means (very vaguely) the kind of exercise that requires you to inhale more. Some suggest that building more muscle through weight training helps as well, since muscle burns fat just by being there and moving your body about; so some weight training couldn't hurt and will probably help.

Many misc.fitness people agree that exercise periods of more than 20 minutes work best. But note that the longer you exercise, the more prone you are to injury since your muscles also begin to weaken. Two things which help prevent injury are:

a good warmup: 5-10 minutes of light exercise to warm your muscles, try to break a sweat
stretching: cautious 20-30 sec stretches for every muscle (for an excellent source of information on the topic, see the Stretching FAQ).

For more information on exercise in general consult the misc.fitness FAQ.