Right Process for Flashing a custom ROM

I am ready to flash a ROM but want to check to see if I have everything covered and truly understand what I need to do. I have tried to gather my info from this site and XDA....

What I've already done:
1.Downloaded the ROM
2.Rooted phone
3.NANDROID backup
4.Copied my SD Card to my computer
5.D/L Titanium Backup (free)
6.D/L ROM Manager (free)

This is what I understand to do:
1.Transfer .zip file onto the root of my SD Card
2.Boot into recovery
3.Complete wipe (data/factory reset/cache partition/Wipe Dalvik Cache)
4.Install zip from SD Card
5.Reboot
6.Enjoy new ROM...?

Questions I have:
1.After flash, do I transfer the copy of my SD Card contents back on my card to initiate install of all apps and other data? I have Apps from three sources: Android Market, Amazon App Store, and 1 other...Is there anything I shouldn't transfer back??
2.If I want to go back to my stock ROM, do I just do a restore from recovery mode?
3.Do I lose data and have to set up each app again with my passwords, etc. with each new Flash? (most apps are on my SD Card-we are talking several hundred)
4.Is it easier to use Titanium Backup to backup each app individually and then again to restore? And is it only for backing up t he Apps on my SD card or all I have downloaded even if stored on the phone itself?

I am way out of my area of expertise here- but am antsy to start flashing different ROMS...!

First off, you never want to backup and restore the red items in Titanium Backup.  Those are System files and are specific to the ROM you are using only. Your new ROM has its own system files. The white files are your user files. Those are what you back up. Green files are your accounts.  You should not backup and restore these green selections either as they are partly system files.

No need to copy SD card to computer.  It is left untouched in the flashing process. Go to the market and install Titanium Backup and let it restore your files and data. Market may try to restore some itself depending on your settings.

If you want to restore your backup then you do just as you said. Do it from recovery.

Your apps and data with passwords should be remembered.  However there is an issue. Backup software will restore the apps as they were first installed.  It will not restore them to your sd card if that is not how they were originally installed. So in that event you may run out of space. I suggest you run Titaium and restore some of your apps. Then move them to the sd card. Then run TB again and move them to the sd card. Repeat till all are restored.

Yes TB should only be used for apps. I mentioned above that there were account items that were green. Most of these should not be backed up and restored. But there are a few than can be backed up and restored safely. SMS/MMS/APN...er Storage, [Bookmarks] Internet, wifi access points.  I don't recommend the others as they may corrupt and cause errors in Sense.

Learned something new about Titanium backup today. There is a setting in the preferences that will restore apps to the original location. So apps you had installed on the sd card will restore to the sd card.  This just made my life so much easier when trying out new ROMs.