I too find the whole Newsstand and In-App Purchaes and Subscriptions to be quite confusing.
I'm really confused, too.
Is there someone how can explain what to do in iTunesConnect for a free app in newsstand?
Thank you for don't let me be a fool.
Download the Companion Guide PDF from the dashboard. It explains how to create free newsstand apps.
For your App to be part of Newsstand, you should have atlease one autorenewable in App purchase subscription. The subscription now can be either be retail or free. For your App to be Newsstand enabled, you should have a Professional or an Enterprise DPS contract and you should aim to publish in-app content frequently (either free or retail). In case you do not want to do this, do not enable newsstand. Once Newsstand is enabled for an app, it cannot be disabled in itunes connect.