Design: How do you decide when items are related vs when they are attributes?
One rule of thumb is that if it is 'physical' (concrete as opposed to abstract) then it is an entity otherwise it is an attribute.

Another rule of thumb in ER modelling is that an table EITHER models an entity OR a relationship between entities but never both. There can be other kinds of table, of course e.g. it is sometimes conducive to put all attributes of the same type (e.g. colors) in a table, known as a lookup table (i.e. is neither an entity table nor a relationship table but is still valid and useful).