First of all it is a beautiful quilt....now to your questions:
When i first started quilting i learned to do the sides first, then top and bottom but i think it doesn't matter, but i just got into the habbit...
I haven't used flannel for backing yet but if i ever make a Tshirt quilt i would as these quilts are very personal and flannel would be cozy and cuddly.
Most of the tshirt quilts i have seen are done with a meander or stipple and i think this is the best way to go not to distract the prints from the shirts.
Good luck