1] best setting? kind of hard to say, its entirely personal, i tend to like program mode where i can control the iso manually in low light. also i use spot af and often recompose after focus (habit carried over from rf shooting) so again things are personal preference.
2] the colour issue will happen, less so if you are using a hotshoe flashgun. the on board flash is not that great, maybe try manually setting the white balance
3] check the cycle time of the flash, you are going to need an off camera strobe