I don't think it really matters whether you do the side borders first or the top/bottom....just a matter of choice. As for the backing, I really like to use flannel as it is much warmer. When I've done t-shirt quilts, I've just used a cross hatching as it is simple and doesn't take away from the print of the shirt panels, but once again, it's just choice. Just my opinion. Great job on the quilt, very well thought out and neat looking.