If you want to use subfolders I would recommend using Horde and not bother installing your own copy of Squirrell Mail.
In horde - go into inbox - click Folders at the top
Select a folder
Choose Action: create folder
Welcome to the forums grimreaper169
Depending on which server your account is provisioned on determines which DNS servers you are supposed to use. If your welcome email was incorrect, please open a support ticket with the help desk and report it.
I know that you used cpanel to modify the .htaccess file but FP modifies it behind the scenes. I believe if you uninstall the extensions and reinstall them it will recreate the .htaccess file that FP requires.
As for what to use to do a site. I do mine by hand with a text editor. Don't use any fancy web site building programs.
Welcome to the forums, Vimal
FrontPage makes it's own changes to the .htaccess files. I don't use FP so I don't have an answer. Maybe someone using FP will be able to help.
If you are getting an error downloading the log file please open a support ticket with the help desk. But before you do, it may be possible that the log was cleared for the month and is actually empty.