1- For example, when we don’t pray, we disconnect ourselves from the source of all goodness in the universe—Allah. We darken our souls. That’s really the biggest punishment. It’s like saying the punishment for jealousy is jealousy itself. People who are always jealous don’t enjoy their lives because they are constantly bothered by the success of others and obsessed with what others have. Those who don’t pray and die without faith, their souls will be lost. Disconnected. And the lack of beliefs turns into a a fire of Hell. Allah has warned us about this because he loves us and wants us to succeed. When he threatens us with punishment it’s because he cares about us.
2- Not all humans are manifestations of Allah’s attributes. Only the infallibles are. Yes, our good attributes come from Allah. As for the bad attributes like greed or evil, it comes from our Nafs and Shaytaan. Allah created them both, but there is wisdom in doing so—such as trying us. Just like a professor puts wrong answers in a multiple choice exam to test his students.
3- For eternal punishment, please see this class video:
4- Yes Allah has created the human in the best form. One meaning is that by default the human is complete and has all the organs/senses/tools to function properly. Now there factors that may cause humans to lose some of these abilities. For example, a person gets into an accident and loses some body parts. The accident was the cause here. Those born with defects, there are causes behind that. One cause is the parents not observing some conditions before conception, during conception and during pregnancy. I’ll give you a medical example. If a woman takes heroin during pregnancy, the fetus can suffer and be deformed. Here drugs was a cause. There are other causes, whether physical or spiritual. Sometimes the cause is Allah trying the parents or trying the fetus in this world. And then Allah will compensate those with disabilities on the Day of Judgment.
Another meaning is that even when we become ill or disabled and have defects, it’s still part of a perfect system. Just like the multiple choice example I mentioned. What makes the test perfect is that you have wrong answers. If the test only had right answers (a b c d are all correct) then it wouldn’t really be a test. It would be flawed.