I am currently reaching the end of my Year in Industry (3 Months left) and whilst I cannot answer all of your questions, I can try to provide decent answers for some of them!
Personally I applied to Uni normally and then deffered my place once I had got onto the YinI scheme, my University was very supportive of this and such if you mention that you are applying to YinI you stand a very good chance of getting an offer. Definitely apply to Uni this autumn.
The application is an online form similar to a personal statement, followed by an interview with YinI. They will then pair you up with certain companies and arrange job interviews with said companies (if you need advice in any of this, feel free to message me. A job interview is different to a Uni interview!)
Definitely mention your Arkwright scholarship company, maybe don't mention the company name until your YinI interview though.
Depending on your placement you will be able to afford to run a car and still save enough for Uni. Alternatively you will be able to afford cheap rent and still save, I haven't heard of YinI students living together, but rent would still be fairly expensive.
Also, Smack doesn't have a very good point there, the majority of engineering grads will have done work (either paid or voluntary) at a relevant company by the time their degree is complete. Doing a full year gives you an advantage when getting graduate jobs as well as making it easier to get summer work.