What wallet / e-wallet is the most convenient for new casual Bitcoin users?

I’d like to make small payments for business purposes through Bitcoin, so would like to know what the easiest method of getting setup to accept a Bitcoin payment is for a regular person, so that I can recommend it to those I want to pay.

Some options I see are:

  • Standard Bitcoin client

  • BitcoinJ

  • Instawallet

  • Flexcoin

These people will only be holding a few Bitcoin at most in their wallet, so security is not as high a priority as in other cases, but I would still like to avoid a Mybitcoin type fiasco where every one I pay loses their money.

Which method has the best combination of convenience in getting setup and security?

What exactly is Mining?

I have heard that mining is for people with ready hardware and blah blah blah… But what exactly is it? Does it operate like real mining? I mean, people talk about it like you are physically mining.

What happens to my bitcoins if lose my wallet file e.g. I suffer data loss and my computer is unrecoverable?

You run bitcoin as a service on your local computer. What happens if this computer is compromised? A corrupt/failed hard drive or theft leads to the machine being lost and unrecoverable, and my bitcoin details (addresses etc) are gone. Do my bitcoins disappear into the ether?

i.e. What happens to my bitcoins if my wallet file is compromised/lost?

What is a ‘Satoshi’?

I am aware that Satoshi Nakamoto is the author of the paper that originated Bitcoin and the creator of the original bitcoin client. However, I often hear the term Satoshi as if it was a monetary unit.

What is a Satoshi?