As is stands now, there are no experience points used for spending. Abilities are bought with credits, and weapons and customization elements, like attachments and outfits, are obtained by completing Challenges. XP is used to determine your level, which is used for matchmaking purposes.
Every time you level up, you are able to purchase 1 new ability, which probably means you earn 1 credit to do so. They didn't want to have XP used as currency, because it would split the community between players who spend it only on gameplay upgrades and those who like to buy customization and aesthetic upgrades, potentially punishing those players who don't go right for the abilities, weapons, and attachments. The only time I can see XP being "spent" is if a player is selling back abilities or "re-specing" or if they are transferring XP between characters, both of which have been said to be in the game.
There will be level limits on matches so level 1 won't be fighting level 20's or they will restrict ability usage,
This is optional. Yes, by default, matchmaking is enabled and will try to match like-minded players against each other, but if you just want to play against whoever you want, you can disable matchmaking and do just that.