Why do we require social interaction/engagement? By requirement I mean there are so many ill side effects of isolation, and everyone feels loneliness after too much time spent alone (although that threshold is different for different people, e.g. some people can't make it a day without talking to someone, others can spend weeks or months in complete isolation, but everyone eventually will feel loneliness, and it's side effects) whereas there are so many mental health benefits of proper social engagement that it might as well be a necessity of life as much as food and drink.

Isolation is a lot more common than we might realize, just because you are not physically alone does not mean that you are not isolated many of us even fail to realize they are living in isolation (mostly because of the notion that isolation only comes in the physical form of being a shut-in). After isolation when the loneliness starts to kick in, Introverts turn to online communities (often gaming, facebook, or some forums) and extroverts have a tendency to turn to partying (MORE PEOPLE!) and often as a side-effect, alcohol and drugs, both confusing these activites with fulfilling social engagement; while they're really just turning into addicts of their own escape mechanisms which are only momentary reliefs from their feeling of loneliness, always feeling deep down inside like something is missing. The introverts that are isolated are usually physically isolated (shut-ins). While the extroverts that are isolated tend to be isolated mentally (closing themselves off; often without even realizing it) building superficial relationships that do not fulfill them.

We all have an instinct that tells us to interact with other people, an instinct that disregards whether that interaction is positive or negative (as we see for example in "attention seekers" that attract as much attention as they can without any regard for what kind of attention it is)

There is some need every human being has to express themselves to other humans.

Why do we so actively seek social interactions? What exactly are we seeking from these social interactions? Acceptance? Acknowledgement? Approval? Understanding? All of these? None of these?

I need to know the full answer to this because I am wondering what kind of social interaction will most fully satisfy our needs. What kind of environment to look for to truly overcome the isolation element, and the long term loneliness that follows and plagues so many of us.
I think you phrased this well, but you are correct that it is a hard question which could be answered in many different ways which, perhaps, may not satisfy you. It is a "why" question so let me give some speculative answers:

-an evolutionary psychologist might say that we have evolved to seek social interactions because humans in groups are more successful (e.g., they can mate, raise offspring together, defend each other from predators etc). It is hard to refute this kind of explanation, and indeed many/most species show a desire to interact, although some niches may have encouraged more solitary behaviour.

-a behavioural neuroscientist might say that we seek social interactions because they are rewarding on a biological level, for example because they release oxytocin which has a range of positive effects on physiology.

-a social or developmental psychologist might focus more on the way that social interactions change self-reported well-being, or on the qualities of the interaction which are most important (perhaps in line with your bolded question). While it is true that particular types of (positive) interaction are best, even minimal contact increases a feeling of belonging. The developmental literature on social enrichment might be a good place to look if you want to find out how to make satisfying interactions.

So, like most "why" questions, it depends what level of analysis you are interested in, but all of these are probably true to some extent.