For 1), see below. This looks like a problem with the Dynamic Web Module facet in the project.
For 2), the add-on does contain its widgetset “fragment”, but cannot know what other widgets you might or might not want to use in the project. The widgetset in your project simply lists all those fragments that the compiled widgetset should contain.
Technically, it is possible (although rarely necessary) to e.g. have multiple different widgetsets in a single project, each containing a different subset of the available widgets. Note, though, that I would strongly recommend using a single widgetset per project unless you really know what you are doing and its consequences - e.g. you can only use a single widgetset on an HTML page.
In theory, the Eclipse plugin might be able to create the widgetset on the fly (making some assumptions that are not always optimal), but then you would not be able to compile your project outside of Eclipse with any simple build scripts.
The message “Unable to locate WebContent folder” is the critical piece of information. The Vaadin Eclipse plugin depends on the Dynamic Web Module facet to find the target directory, and cannot compile the widgetset if that facet does not know where WebContent should be.
Does your project have both the “Dynamic Web Module” and the Vaadin facet installed? How did you create the project? With the “New Vaadin Project Wizard”? With the “New Dynamic Web Project Wizard”? Otherwise? Have you modified the location of the WebContent directory from the default, and if so, how?
Which Eclipse version are you using?