1) Kayla has a jungle/ noah's ark theme in her room. Others I have seen a lot of are teddy bears, farm animals, circus, underwater. Alternatively, you could also offer bespoke commissioned pieces as you are going to be making from scratch anyway.
2) £20-30 but more for a commissioned piece (maybe £10-20 more). When you are pricing up someone once told me a good place to start is the cost to produce x3 (so 1/3 of the retail price will go on costs, about 25% will go on tax and the rest will be profit).
3) Definitely leave info with local baby groups. But easiest route would be Ebay.
4) As others have said you have to declare any income from the start. You must have registered your own business with HMRC before your raise your first invoice but you will be able to put expenses receipts through up to 28 days before the registered start date of the business. Agree with others to check with landlord as I suspect that the issue is with people visiting the house for business purposes. We couldn't have frequent visitors for our business but can run a business from home iyswim.
5) Sorry, can't help on this one.