1.) I assume you're editing on a 30fps sequence. So you have 397 seconds of audio, which is 397 x 30fps = 11,910 frames worth of audio. So take 11,910 and divide by 129 (photos) = 92 frames per image. So in the Premiere Pro preferences, change the frame number to 92 frames. Keep in mind, this will only affect any future images that you import or create in Premiere once this change has been made. So you will have to remove your photos from the project bin and re-import them for the timing change to take effect.
2.) By selecting the ripple edit, shifting trailing clips button, this should take care of your problem. Were the images at different time durations, or were all of them the same.
3.) Regarding your projects resolution, you need to find out if you want this project to be a widescreen (16:9) or standard (4:3) ratio. Personally I would stick with widescreen since this is how 99.9% of video productions are nowadays. If this is what you want, I would create a 720p project. This is 1280x720 and will playback nicely on your 800x600 projector. You obviously will have the letterbox effect, black bars on the top and bottom of your screen. If you would rather fill the projector screen, you can create a custom project and manually enter in your resolution of 800x600 (this will only work is you're going to playback the video file from a computer and not a video DVD, as you may know, DVDs res is locked at 720x480 (NTSF). You can set up the custom res when creating a new sequence. Or to keep things a little simplier, just create a DV 720x480 4:3 project.
Hope this helps.
Thank you Mike for taking the time to offer such a fantastic and thorough answer!