Help a new biker with bad fitness to become a bike commuter
Others have answered other parts of your question satisfactorily, but I can't recommend Craigslist highly enough for purchasing your first bike.

You can find cheap used bikes anywhere from $50–$200. It doesn't have to be perfect — it just has to be in a reasonable state of repair. Don't spend $1,000 on a bike before you 1) know you're going to stick with cycling, and 2) know what you want out of a bike. Getting a cheap one off Craigslist lets you figure out both at a very low cost.