New M1 owner starting installation

Just purchased a new M1 gold with a dbhr and ethernet connection so I can swap out a 13 year old brinks system (BHS 2000).  I have 3 keypads (Ademco) to replace, 2 smoke (4 wire), 3 CO2, 1 motion and 35 doors and windows (I will cluster into 9 zones). None of the doors or windows have an EOL resister, but it sounds like this is not a big deal for a private home.
 
I already have a nice insteon dual band system (about 30 switches and outlets) run through an ISY and want to integrate this with the M1.  I have looked through the M1 manual multiple times and will be setting this up this weekend.
 
I do have several questions:
1) What do I do with the 2 extra wires at the keypad, as I am just using a 4 wire system with the DBHR?  Just cap them?
2) With 3 keypads, do I wire all 3 and then go back to register each of them or do I need to wire and register 1 at a time?
3) I won't have anything going out of output 2 on the M1 and in one place it talks about looping a 2200 ohm resister in this space to avoid "problems", is this correct?
 
What else am I missing to avoid surprises?
 
Thanks
 

1) I have Cat5E to each of my keypads and use a DBH (non R). At the DBH I terminated the Cat5E like a standard network cable with all conductors used. At the keypad, I trimmed the non-used wires and used heat shrink to cover the ends to eliminate the possibility of any shorting.
 
2) I usually connect all keypads first. By default, all keypads will be addressed #1. You will need to determine which one will remain as #1, and adjust the addressing of the additional keypads. After the addressing is complete, you would perform the enrollment process; you can do this via keypad or via ElkRP.
 
3) If you do not place a 2.2k resistor across Out2, a trouble message will appear on the KPs.
 
Many people end up having problems configuring the XEP. There are a number of threads here about how to do it. As long as you follow the procedures in the manual, and understand some basic networking principals, you shouldn't have any issues. If you have any, report them here. We'll be glad to help.

In order
 
0. Break the system's zones into as many as possible. The smokes should be on a single zone and the CO's should be on their own, so that should leave you with 12 zones to play with.
 
1. If you have 6 conductors at the keypads you do not need a DBHR. If you intend on using the hub, I'd tie the pairs to the input and output respectively and use those (3 more zones is a plus.
 
2. With hardwired devices with addresses/dipswitches, configure before powering up the system. With devices with software addresses, wire them then power up. Enrollment is done after the bus is up and running.
 
3. Yes. You can leave the bell outputs disconnected from the panel with no foul while you are programming and configuring. Should be connected when a final test is performed.

You might look at purchasing the M1XIN 16 zone input expander for $80. It will fit in the Elk 14" enclosure next to the M1G board and comes with the standoffs to mount it. The only thing you need is a long philips screwdriver to tighten the screw on the mounts. This will give you more flexibility so you don't need to condense 35 zones into 9.