Well, Farhan, you've asked many, many questions. Let me try to answer some of them as good as I can from my point.

If you're recording a track from your stereo line in plugs of your sound (or better audio) card then you can be accompanied by a stereo track from your harddisc at the same time. Your Windows OS has a little mixer for the sound card to mix the sound sources together to one output plug.
Well, using a professional studio software means you're having more options to mix and record tracks. Look into your software manual how to switch ins and outs for your song - be it audio or midi.

It's very professional to spare data space as much as possible. If you're using real hardware synths then you're able to record midi tracks which will control your hard synths in real time. So, you can create all sounds again and again without the necessity to record it as an audio track.
Remember: One minute stereo wave sample at 16bit/44.1kHz needs 10MB disc space but a whole midi arrangement with 16 midi channels programmed and up to 20 minutes playtime keep it under 200KB.

IMHO audio tracks are needed right in that moment when you're recording sounds with natural curves (for example: chorus, flanger, phaser) or instruments with natural attacks and decays by the player's fingers (for example: voices and all analog instruments).

Personally, I tend to use analog mixers for ADD recordings. If you're mixing it digitally then you'll become many problems with actual computer standards. We still have a 16bit/44.1kHz recording standard but at the moment we're going streight into a 24bit/96kHz recording era. Oh no!!! The next standard can be seen at the horizon - 24bit/192kHz! And I guess there will be no end for this death spin...
Digital recordings will never reach towards the analog quality especially for mastering!

Well, I hope I could help you a little bit. I wish there will come some more opinions by other SynthZone members to mix some other colours into this thematic...

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Greetings from Frankfurt (Germany),
Sheriff ;-)

[This message has been edited by Sheriff (edited 10-25-2005).]