It isn't based on any actual time period, it is actually based on several different Japanese folk stories from ancient times.
I would say around 248 AD, since Queen Himiko is there, and that is the time she was in power in real life.
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Pres a and b at same time and hit up or down
Yes You can
In Okami there is a day every Hundred years called the day of Darkness when the moon completely covers the sun an at that day in the game you will face the evil Lord Yami.
You use the power slash and the item will float up to you.
yes, it's used for controlling where you walk.