No, you can also use mapping and geocoding services from third parties to build your applications, for example, Bing Maps or Google Maps.
You have access to limited batch geocoding through the ArcGIS Online World Geocoding service that is included with the Community Analyst API. If you need to batch geocode more than 1,000 addresses per year, you must purchase an annual subscription.
Yes, ArcGIS APIs are available at no cost to developers who want to build internal and noncommercial, external use applications. If you want to use ArcGIS APIs to build commercial use applications, you must purchase an annual license.
No, not at this time. You can only get drive-time/ring analysis and demographic data reporting through the Community Analyst API.