Yeah they make it a little confusing. The main reason I would go for the paid account is if I needed to take phone or other orders. With that you have virtual terminal so you can do manual entries. I would just recommend a merchant account at that point so you can keep the cc #'s so they can't hold you hostage.
Yes, I would second going for the business account as it doesn't cost anything extra really and your name won't have to appear all over the invoices / bills.
Also you can combine it with a service such as jvzoo or warriorplus to allow for a trial period then the reoccuring billing will happen automatically once that trial period is over.
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