Ok, so I have done most of my homeworka dn I've studied Gophers videos. They are really good and informative but also a bit slow in progression. But no complaints.

My question is simple and it's to make sure I have understood things right.

When asked by NMM if I want to replace files...

Chossing "Yes to all" it will replace files and that's final.

Choosing "Yes to Mod" will replace the files, but create a backup so upon uninstallation of a certain mod it will restore my old files?

Is this correct?

Nope. Yes to mod means the mod you're installing can overwrite the mod you're being warned about.

Example.

Mod 2 warning, you are about to overwrite SomeFile1 from Mod 1...

Yes will allow the overwrite of SomeFile1, Yes To Mod will allow all of Mod 1 files to be overwritten.