1. Once the site is set up, I think we can go in and edit the blogs ok - add our own photos, information, etc? It's ok to edit the blogs and articles that are already included from your offer? Is there anything we need to be careful of so as not to upset the senuke campaign or the drip feed of unique articles?
Yes, please! The days of expecting a blog to run effectively without your input are over. Add photos, rewrite content, add your own content, everything!
The content that is dripped into your sites is not designed to be everything that is added.
What you have is kinda like a car with an automatic transmission and cruise control. These things make your lie easier but you still drive the car.
Your site will work much better with your input - but I know that some people will be happy with the much lower returns that come from unattended operation.

The SENuke campaign will be concentrating upon getting the site noticed a little and thus be majoring on the home page. I will make sure any inner pages I link to exist before kicking off the campaign though.

The ArticleBuilder content comes from my account and I am setting up a seperate user account within each site to accept these articles. If you choose not accept the AB content then just change the password or delete the account within WordPress (there's a video about doing just that in your package)
2. I am not quite sure what "we will add content from high quality sources, this will be delivered automatically and you can control the sources as you choose" means? Control what sources and how?
Within each site is a plugin called Feedwordpress this is usually going to be set up at delivery to accept content from Knowhow-now.com, one of my sites. Within FeedWordPress you can add new content sources (rss feeds) and configure how they work. It is not too hard to do. I have set up the major configuration stuff for you already.
If you do not like the content from Knowhow-now then just delete the feed; or change the keywords within the feed itself in the control panel - when you see the feed url it will probably be self explanatory how to change the keyword in the feed.

I modified the knowhow-now feed output to better suit the purpose of the sites I am building for you. Most feeds are very short and thus not much use.
If the content from ArticleBuilder needs altering slightly, perhaps adding an additional keyword to filter the content then pleae contact me and I will make that change for you. Of course if you have your own AB account then the world is your oyster in this regard!
By the way, I have been delayed a little in getting sites completed. My main PC hard drive where most of my day to day work lives decided that a 2Tb hard drive needed scanning and checking. I had no idea that it would take so long. Everything I did in the last day or so was from the PC that runs my TV and HiFi - not convenient.