In the order of questions.
- The most recommended way for SharePoint development is to have the same test / development farm as production. But for your particular case (environment and task) your development environment seems to be enough.
- As you are developing solution for SharePoint in Visual Studio you can create WSP for deployment directly there. You haven't specified VS version, but for example VS2010 has an OOTB project templates for SharePoint 2007/2010, VS2012 also has (but I'm not sure about SP2007), for VS2005 and VS2008 there were some extensions / addons for this. The wsp should hold all customizations, so you can easy perform deployment, updates, etc.
- In time of 2007 there were two editions of SharePoint - light WSS3.0 and heavy MOSS, in 2010 it becomes to SharePoint Foundation and SharePoint Server. So SP Foundation 2010 is like a next version of WSS3.0
As for your task (auto tasks for folder) the best practice would be to create custom event receiver for folder item creation event.