1- If you're getting a spindle/VFD combo, you should be able to find the right spindle speed for whatever bit you use. I prefer 2-flute caoted carbide endmills for most aluminum work, and 3-flute when I need a fine finish, though 2-flute works well. Although HSS may be sharper initially, carbide stays sharper longer. You have to take lubrication or coolant into consideration when making your machine. You can machine aluminum dry, but you'll wear your bits out faster. I have 1/16" single flute bits also that work well.
2- Go to the toolmaker's website, and you'll find the information you need to calculate what speeds and feeds you need to run their bits. You may have to adjust down depending on your machine's ridgidity (depth of cut).
3- I presume water cooled is quieter, but you have to run hoses and a water pump and tank, maybe even a radiator. A lot of guys here use them with no problems however.
4- I use a 2-1/4HP router, which is about twice what you're looking at. I cut a lot of 1/4" aluminum, and it seems to do the job well. I started out using a 1HP router, and the difference is like night and day. I also use a SuperPID, and it gives me more "ooomph" at lower rpms. Your feedrate will be dictated by your spindle speed, and your depth of cut will be dictated by your machine ridgidity as well as your spindle's power. Basically, the faster the feedrate your machine can handle, the better the cut surfaces will be.