MatthewMan wrote:
Why do I need an email addy for notes?
I don't use Notes so I can't advise there - you should ask in a new thread, titling it specifically about Notes to get a response. As this thread you've tacked on to isn't about that you're not likely to get a reply here.
What else do I really need the email for?
Apart from Notes, if it really is the case it's required for that, you don't need it - it's an additional email service you can use or not use as you wish.
How can I use the email?
Sign in in System Preferences (or Settings)>iCloud and check Mail in the checklist there. (Lion 10.7.2 minimum or iOS5/6 required.)
If I give my @icloud email out will people be able to email me and I can email them back and all is stored in the cloud?
Yes - it's an IMAP email service just like any other.