1 First, when rolling treasure, for monsters how do you go about rolling, say you fight three gnolls, do you roll once for each gnoll, or for the entire encounter?
My DM rolls it as one; you figure out the total challenge rating of the fight and roll from that, but special enemies (plot point enemies or what have you) would be determined separately(and ahead of time, frankly).
2 How rare are magic items in your campaign?
Well, it depends. We're all sixth right now and everyone has a magic weapon(except the fighters, who have two) and most of us have some sort of minor magical item like a cloak of resistance or gauntlets of ogre power, but anything beyond a +1 bonus is more rare. Magic items should be, as styrathys and neverborn said, rare enough to be meaningful for the players.
3 How hard is it to get magical enchantments done, for instance, if someone has the money to get a plus 5 flaming holy longsword, how hard would that be to get done?
It takes forEVER to enchant something. It's not just a question of money. To enchant something takes a day per 1000 gold, so a +2 weapon takes four days. Your +5 flaming holy longsword is a bonus of +7, so that's 49 days of enchantment. So even if you've got the money you can't have it right away.
4 Do you abide by the GP limit in towns?
More or less. A small town will not have crazy expensive items or high-level spellcasters.
5 At higher levels, do spell casters get to cast two spells, as a fighter gets to attacks? (when a wizard/sorc has a +6/+1)
No. There are metamagic feats that let you, for example, cast a spell as a free action, but it's just one spell and you have to memorize it as two levels higher (so a first level spell takes a third level spell slot) and so it really isn't very good.
6 If you have full plate on, but your dex is say, 16, giving you a plus 3 bonus, do you get a reflex save bonus of plus 3 for the stat, or plus just plus 1 from the Full plate?
You only get the +1 that full plate allows. It's harder to move out of the way of a fireball just as it is an attack with an axe.
7 If a Dwarven Defender, had Dwarven Full Plate(DR 3/-), would his class damage reduction stack with his armor?
Stack it up, but where the hell did he get adamantine armor?
8 does there exist a better chart for the encounter levels setup than the one in the DMG, the whole thing confuses me, perhaps if someone could explain it in more simplistic terms? That would be great..
Oh my god, that thing sucks. You can work out your own encounter table, but what makes more sense is to figure out half a dozen decent fights for your party (i.e., challenge rating appropriate) and use those for random encounters.
You really should read your DMG cover to cover, as nerdy as it is.
The stuff we have the most trouble with is movement in combat, charging and threatened squares and all that, because it's hard to do without a map, but we've got it down now, so if you've questions about that, ask away.