1. You will want to use Migration Assistant. But this will bring over all the old "junk" you mentioned.
2. Only if you want system settings brought over. If you want to reset them all, you can uncheck it.
3. You can just pop the new blank drive in then option key boot to your Time Machine backup and format the drive then restore all from the Time Machine backup disk. No need to redownload the OS.
The only true way to get and entirely "clean" install is to install the OS new then manually reinstall every app and setting. If you are not familiar with OS X, this can be quite a chore. IMO, if you current system is working okay, I would just restore it then you can manually look around and delete old things you don't need any longer.
Yeah, I don't think I wanted to reinstall every app and setting. I've got it working so well right now, I just don't think I'm up for that kind of headache. I don't get panics/crashes etc. Was trying to get as clean as I could, without turning it into a two-day project.
Last question.. when you say use the option key to boot via Time Machine, when/how exactly would I do this? I figured I would use Command+R to pull down Mountain Lion, then restore from TM backup, i.e. Step e here.
Seems like its better to get a brand new ML download from the internet, then dump Time Machine backup onto it? Versus automatic re-image from existing Time Machine backup.
Also, will my machine have trouble finding my Time Machine via NFS share (NAS) when I first get going again?