To your first point, yes, this is how I seem to recall it working. The champion can get drafted, but not the championship. Henry would show up on Raw and in the Raw rankings, but defend the World Heavyweight title on PPVs against the top contender from Smackdown. When this happened in my Universe, I simply stripped the champ of the title and awarded it to whoever was the No. 1 contender.
As far as abilities, the one that I have seen most from heels is the ring escape ability. You can hit LB when you're near the ropes and you'll roll out of the ring. You can do this three times a match. A lot of the other abilities cover things like being able to do springboard dives, dives to the outside, etc.
You can have five allies and five enemies at a time.