Hi PondGuy,
1. The Humminbird SI models don't have a separate channel for down-scan. I believe that they produce their down-scan image by rotating and superimposing the two sidescan channels. Although we did consider emulating this behaviour to produce a "pseudo" down-scan display in RM, we decided against it in the end. The newer ONIX units do have a separate downscan channel, and this is displayed in RM.
2. It's not uncommon in shallow depths, especially with harder bottoms.
3. E2 is the best layer to use for hardness discrimination, but it is very common for users to collect data that doesn't always contain the full second echo return. Composite uses an average of all available return types, and can be useful where some areas have E2 returns and some don't. Using composite lets you use this data as part of the hardness calculations without having empty areas where the data is missing, but if you have good E2 returns then I would stick with that.