The Active Directory Schema is a place where you can modify the behavior of Active Directory. This is basically the structure of the database. The schema describes the attributes of the data in the Active Directory database.
Functional levels in Active Directory allow different versions of Windows server products to run. Most organizations are going to have different versions of Windows servers running at any given time due to the wants and needs of the business. Active Directory has two organizational levels, domain functional level and forest functional level.
You want to get your domain names as short as possible and make it relate to an area of the business and not a project or a department as these can change. The easiest way to install Active Directory is through the DC Promo utility and the Active Directory wizard. The whole process in pretty straight forward and you can uninstall and back up Active Directory using the same utilities.
Active directory is a centralized directory system used on Microsoft networks. Active Directory is organized with forest, trees and domains. Within the domains you have organizational units. Inside of the organizational units you can apply group policies. So with Active Directory you only need one log in to access all of your companies resources.
For example, when you log in to the active directory it will authenticate you are the print server, web server, and mail server, etc. This comes in handy because the different servers may require you to change passwords at different times, but in this case Active Directory will handle this. It is a centralized resource.