1. You may need to use trial and error to figure out the path you want to use here. Make sure you have specified the remote root and local root settings correctly. If you are just testing on your live server, set the local root to have the same setting as the remote root option. If you can't figure this out, i suggest you submit a support ticket to have a technician help you get this working properly. You can do that here techsupportinsert_1.php
2. If PowerCMS is not stored at the root of your site, those two settings will need to be adjusted accordingly. If you are looking to change it on the Developer Notes, simply open the contents_detail.php page and change it there.
As for CHMODS or file removals, these should not be necessary if all the steps are followed correctly and it is set up properly. If you continue to have problems, please submit a support ticket to ensure your issue is resolved...but post back here to let us know your situation.