Q: Using Extreme as TC Extender

Current setup: Time Capsule tower (a/c version) as primary router, and using Airport Extreme (A1143) as extender via Powerline (AV2, gigabit ports). 

Thanks for all the great advice on network setup in earlier posts.  I have a couple specific questions I haven't seen specifically addressed:

1) I set up the AE using airport utility to extend my main network.  It appears I'm set up correctly, as airport utility shows a solid line from my TC to my AE (indicating ethernet connection between the two).

However, when looking at my AE settings in airport utility under the WIRELESS tab, the "Network Mode" is set to "Create A Wireless Network."  Shouldn't this be set to "Extend A Wireless Network?"  Since airport utility configured it that way, I don't want to mess with it.  But since the router is in "Bridge Mode", why isn't the Network Mode set to "Extend?"

2) Using the application WiFi Explorer on my Mac, I see two entries for my main network, which I assume is normal with my setup.  Sometimes these two networks are on the same channel, and sometimes not.  Does this matter?  Should I set them up to share the same channel?  Or force them to use separate channels?

3) I'm assuming my setup using the Powerline adapters is better than connecting the devices wirelessly, but inferior to connecting them directly by ethernet.  Is that correct?

Thanks, in advance, for the help!