He's saying if the seller is a foreigner they'll want a COE from him also.
This however was a requirement ONLY in Chiang Mai, and has since been dropped. If the seller is a foriegner, he needs his passport and a current entry stamp.
So you can apply for any visa through the embassies online system, but you need to mail your passport to the embassy and have the visa stamped in it. Thailand hasn't figured out the internet 100% yet.
The only thing you can get 100% online would be a visa exempt entry, which just needs a COE which is emailed to you.
No, and the STV is being phased out. You can extend it after September. A regular Single entry tourist visa is good for 60 days and can be extended once for an additional 30 days (total 90 days).