Drupal 7.x

Hello,
I was trying to setup a User Reference field on a custom content type but I am not seeing that option. I tried the Reference field but that wants to link to a Taxonomy. The next question follows from that. I have 3 vocabularies but I don't see how to attach them to a particular content type. As it is, only one taxonomy is available when I did select a reference field.
Can someone explain this? For the first question, is there another module I need?

I have been trying to duplicate the Drupal 7 core Book module and use it for documentaries. I have gotten it somewhat working by replacing the word "book" in all the files with "documentary". However, when I open the outline tab of a normal content page, it does say both:

The outline feature allows you to include pages in the Book hierarchy, as well as move them within the hierarchy or to reorder an entire book.

The outline feature allows you to include pages in the Documentary hierarchy, as well as move them within the hierarchy or to reorder an entire documentary.

While following the "Major version upgrade" instructions in UPGRADE.txt at step 13, "Run update.php" I got redirected to install.php (which is not too surprising), then got this error:

Fatal error: Call to undefined function theme() in /includes/install.core.inc on line 702.

Searches for that found lots of "undefined function theme()" hits but none on install.core.inc. I'll tellya, when I run into an error message and I can't find someone else with the same message using Google, I get scared.

error info:
The specified file temporary://file4VI8Kd could not be copied, because the destination directory is not properly configured. This may be caused by a problem with file or directory permissions. More information is available in the system log.
http://ftp.drupal.org/files/projects/corolla-7.x-1.20.tar.gz could not be saved to temporary://update-cache/corolla-7.x-1.20.tar.gz.

How do I modify the php templates for the stark theme in drupal 7? There are no template folders. That confuses me greatly...

trying to install D7 RC4 on xampp on linux (from apachefriends). I'm using FF (if that is relevant). Installer gives me the error:

Failed to connect to your database server. The server reports the following message: SQLSTATE[28000] [1045] Access denied for user 'exampleusername'@'localhost' (using password: YES).