Your second question related to locality.
Yes, we feel the concepts of locality and local-realism are confounded. We are comfortable with the definitions of both, which we understand as follows, but not with rolling them together. The principle of locality is that the behaviour of an object is only affected by its immediate surroundings, not by distant objects or events elsewhere. Hence also local realism: that the properties of an object pre-exist before the object is observed, and independent of observation. We feel that many of the Bell-type inequalities that are used to preclude NLHV solutions are rendered doubtful or even invalid because of inattention to detail in this area. However we also feel that the confusion between the terms is natural, given that people are starting with a mental model of a 0-D point. If matter really is a 0-D point then it is acceptable to merge locality and local-realism into one concept. However, and this is our objection, it is not logically coherent to make that merge, and then try to use that to prove that matter must be 0-D points. This circular logic appears in many of the Bell-type inequalities.
Our paper does two things: first it shows by reason that the Bell-type inequalities have serious underpinning flaws due to their circular relationship to their premises; and second it offers a specific solution that falsifies those inequalities. If the cordus challenges holds up, then it means that there is a whole new deeper level of foundational physics to explore.
Also, our model suggests that time is not a dimension, hence rejecting the idea of spacetime being a fourth dimension. Instead time is a discrete property at the fundamental level, and emerges as an apparently smooth effect at macroscopic scales. More specifically we suggest that, at its most basic level, time originates with the frequency cycles of the particules of matter and photons. The macroscopic perception of time arises because the interconnectedness of matter, via its discrete fields, creates a patchwork of temporal cause-and-effect. Thus the smooth time as we perceive it emerges at the macroscopic level. http://vixra.org/pdf/1201.0060v1.pdf. In this sense spacetime is accepted by cordus as a approximation, one that is sufficient for large bodies (i.e. at the scale for which gravitation usually applies), but not the fundamental reality.
There is that word CAUSALITY which you also use. It is intriguing that you came to a that conclusion too. Of course you approach it from the distance perspective, whereas we used time. We would expect these to be complementary. You also have the connectedness idea. We are interested to see how your idea develops.
Dirk Pons