2 newbie questions....

I am copying my current website data and converting to Joomla. I am working with the Joomla Training Joomla sandbox. I have copied my current pages (cut and paste) into Joomla articles. After I create my menu system I will want to upload it to my host's server which I have installed Joomla on.
My questions are as follows.....

1. How do I migrate the files (or database?) from the sandbox environment to my online site, which files do I transfer to what directories? (Am I correct in assuming that I am supposed to use FTP software?)

2. When I copied and pasted from my old site into Joomla articles, both the text, and pictures copied as well. Are those pictures only stored with the article? Should I expect them to be in the "stories" folder? Am I making a huge error and not copying the images at all only the links and they are really still on my old server and will disappear when I take my old site down?