Q: I Hate the dock!

I can't answer any of the 'Why' questions, but I can give you some tips.

To see all windows open for any given app, place your cursor over the app and either 4-finger swipe down (if you have a trackpad; not sure if there is a magic mouse gesture for this) or control click 'show all windows' on the keyboard.

Just a control-click with no swipe will give you a list of the open windows, too.

The red icon button is not supposed to close a program, just the window. However, unfortunately Apple have been messing with this since Lion and Mountain Lion and now some apps like TextEdit, will sometimes actually quit if the window you close is the last window, whereas others will not (and sometimes TextEdit will not). This is supposed to be an advanced memory-management 'feature' not a bug, but like you I find it annoying. If you want to close the app, the simplest and quickest way is to hit 'Command- Q' on the keyboard.

There's always some frustrations when switching from one OS to another, sometimes you just have to get used to the differences or go back to your original OS!

In System Preferences, Dock:

Check Minimize windows into application icon to stop the Dock from showing a second icon for applications with open windows

Check Show indicator lights for open applications to get a white tell-tale under the Dock icon of any running application

Hopefully those deal with items 1 and 2 (but say if I've misunderstood)

In System Preferences, General:

Checking Close Windows when Qutting an application will revert to old behaviour (when you quit an app, you save your documents, when it reopens, it doesn't reopen documents).

The red X button close a document/window, not the application - that's been the design behaviour in OSX since the first version. To close the application you do Cmd-Q.

Starting with Lion, applications have an (internal) option availabe to them to choose to close when the last window is closed. Preview and some other built-in Apple apps use this option, but not many 3rd party apps do yet.

I realize this post is four years old, but I was doing some follow up on Dock behavior, and for those who happen upon this, I have some further comments that may help:

Install HyperDock: https://bahoom.com/hyperdock/

This tool provides the on-hover, selectable application window pop-ups asked for by the OP.   It also adds a slew of things that Windows and Linux do correctly, such as screen snapping via keyboard shortcuts (an absolute must in multi-monitor setups).  It isn't free, but at the time of this writing it's only $7.

For full disclosure, I was raised on DOS, moved to Windows, had a Mac briefly in the mid-90s, moved back to Windows and also Linux, and purchased a MacBook Pro about 14 months ago (on which I also run Linux and Windows).  I am very comfortable in all three OSes, and I love aspects of each.  It always surprised me that the latest OSx desktops lag behind on some of the features that the Linux and Windows desktops got right long ago.

Anyway - for anyone else with this question, I hope it helps!  :-)

(Now I'll continue my search to determine if there's a means to switch the dock between monitors via a right-click or keystroke and have it stick there, rather than the clunky "drag your mouse to the bottom of the monitor" behavior which tends to be unresponsive when I do want it and prone to bouncing between monitors when I don't want it!)