Correct, this means that you can update firmware (up to/including FW 70.00.100 and not have to worry about changing root password or building the serial interface.
If you do not want to install the AIO Android Auto Tweak, then I would recommend to install 70.00.100, as between that and the older 59.00.502 a lot bugs were fixed. And this way you do not have to update again before installing/retrofitting the AA/CP hardware (new hub+2 cables). But of course, you are free to update to whatever version you would like to. And yes, there is always a letter behind the versions, but only one version with one end-letter of each firmware is available. The letter does not have a meaning.
Regarding your wifi question: WiFi option is to enable WiFi at the radio, correct. This enables you to connect to an WiFi of your own (e.g. a hotspot created by your mobile, your home router or an mobile router at your usb slot). But having WiFi enabled in your radio (MZD/CMU) is only relevant, if you want to use Mazda`s optional services, which you have to pay for (at least here in Europe there are some available), or you want to access the MZD/CMU via SSH to change some files. The WiFi of the radio does not have internet access by itself/can not reduce the data consumption of your mobile data plan, when connected to it. Usually the WiFi of the radio should connect to your phone`s hotspot. Try using an short/easy WiFi Hotspot name/SSID (just letters) and an 8 digit password using numbers only to test it. I think that there was some issue with iPhones and the WiFi Hotspot, but as I do not own an iPhone, perhaps someone else can help here.