Answering the points in step 1
Not at all. The holes drilled on the sides circulates ample air to keep it fresh and healthy.
Terracotta pots can be colored.
Sell the compost! Better! Gift it to a Gardener friend.
Ever body can do it! Do it to save the land fills. Less land fills means more trees!
ust takes 1/2 a day to setup and it sustains by itself.
Why not try again!
You can do it on the terrace, or near the window!
Added after the comments:
Thanks to http://www.dailydump.org/ and their presentations