1. There is a lot of code on this forum for rain/fire/snow effects already. Do a forum search or Google Advanced search for the codes. The fastest method is to use particles as no collision detection is used. The slowest, but most realistic is to use entities which can be removed on impact with the environment.

2. Do you mean like the car demo on the download page? You can use a moving texture or use a regular texture and adjust it's position using u,v coordinate. I forget where that is in the manual. And I know someone on this forum will suggest you look at MystyMood's template so there's that resource as well.