Colleen, here to answer your questions:
1- since a standard page is 3600×3600 and the resolution should be like 300 pixel/inch when printing, it means that a 300×300 px element will be one inch. That is ok for a button. One trick is to put your element on a full size image and see how it looks.
2- Whatever ratio you view your image or work with will not affect the end result. If you work on something that is 1000 pixels, it will still be 1000 pixels, whether you view it at 20%, 100% or even 400%.
3- Yes, you can use the Magic Wand, using the None match and checking the Contiguous checkbox. Then, it will select inside each section and you can hold the Shift key to select another one. Then, you can enlarge your selection by a couple of pixels just to avoid tiny gaps. Since you will want to work in a separate layer, you can also use the Brush tool to cover any imperfection.