For a minute, I thought you meant the spider women from CV64, which make an appearance by coming out of the poison water...
1. The DLC may or may not be free (in fact, it's most likely not). DLC stands for "Downloadable Content". It's usually extra stuff related to the game, whether it's artwork, a new costume, new chapters to play, new armor/weapons, etc. It really depends on the game developers what they want to give you.
2. You'd start the game and it'd probably ask you for an update. Once you update, it'll have an extra section in the menu at the beginning saying something like "Purchase downloadable content" at which point it'd connect you either to PSN or to XBL and have you pay for it. Then it downloads to the HDD in your system and your game accesses the files form there.
3. You were flamed here? Must've been a few years ago when people were completely hating on Legends, as opposed to now, when people... only mildly hate on Legends, and mostly find it inconsequential. Anyway, apologies for that.