Address and phone and name are for shipping. If you ever use your paypal to ship real world goods, remember to change these before purchasing. Lots of places use your paypal details, so if your stuff gets help up in customs or whatever, they need your phone number (and obviously they need your name and address to send stuff to you). It doesn't matter if you are just buying electronic goods.
There's a few ways transactions can work, either you deposit money in to your paypal account from a bank or from other paypal (eg selling TC), or you can set it up to automatically withdraw money from an account or credit card when it needs money.