Colossus you will find that if you tighten everything all the way down things just wont move. You want it to be snug but not overly tight.
DW a carbide bit should last about 10-15 cuts before it needs a little sharpening.
Is that eagle lathe the red one? I saw that one before and I just didnt like the way it looked. The bit from the cobra lathe is the wrong style bit and using it will really screw things up, there are left and right hand bits. The style bit you want is either AL-4 or AR-4 I forget which one the Cobra Lathe uses but you obviously want the other one. You can buy carbide($3), diamond ($53), or high speed steel ($8) bits at www.mcmaster.com
for a very reasonable price. They offer Carbide and High Speed Steel for cutting various different materials you want the compound for non-ferous metals. Personally I like High Speed Steel over carbide because I can sharpen them myself with a hard Arkansas stone and dont need a special gringing wheel. I have one of their diamond bits and it works great and has lasted a very long time.
Speed of the lathe should be reasonably slow. I use a stock armature in a mod can with timing set to 0 and run on two cells. This is slower than alot of people run theirs but I get great cuts. You can buy that 55 turn motor from Integy or Race Prep. I plan on buying one soon so that I can run my lathe off a 6V gel cell.