You need a flat network if you want to map an external network in your cloud to a physical network in your datacenter. The external network will be of type flat.

Your users may not have the need to create their own networks. All they need are instances connected to the internet or intranet. One or more flat networks are fine in this case, and instances connect directly to them. Flat networks don’t support floating IPs, routers and tenant networks.

If the users in your cloud require the ability to set up their own network structures consisting of several tiers and routers, their virtual networks must be separated from each other, although they are typically implemented on a single physical network. Neutron offers VLAN, VXLAN and GRE as separation mechanisms. VLAN is limited, since not more than 4096 VLANs are possible on a physical network, and VLANs can’t cross networks. GRE removes these limits but since it consists of a separate IP type, routers may not like it. VXLAN uses UDP, which is normally not blocked by routers.

Flat or Vlan depending on your physical configuration. Usually we have multiple vlan on a trunk inside your external interfaces so the ml2 provider was configuration on Vlan mode. And yes, that for public network / provider Network for FIP but you can assign directly an public IP on your Instance.

Indeed , Vxlan are for private IP on instance.

Not sure if i answered on your questions ;)

Regards,

Stef