1) Will MC15 automatically do the file conversions necessary?
2) How do I know how much of my library will fit on about 10-12G of my 16G card?
3) Assuming I don't have enough room on my MicroSD card how can I sync a subset (i.e. selective playlists) to my Motorolla Droid handheld.
1) It certainly can, automatically if you choose
2) testing/trying seems the best method to me. there isn't anything that I know of that will let you select X size *after* converted in a smartlist, but it would be nice. If you figure your flac files are about 1/2 the uncompressed size, and a converted file is closer to 15% of an uncompressed file, you can try with creating a smartlist the limits the size to about 3 times the size you want the converted files to be (in your case, about 35 gig limit)
3) use smartlists. if your is pulling too many files when you go to sync, it will tell you that you have selected too many files and do you want MC to remove the extras. this is your signal to modify your smartlist to a smaller limit.
when you connect your device, after about 30 to 60 seconds, you will get the option to Sync Handheld in the action window (lower left). When you click on that it will show you all the devices you can sync to. You may see 2 options when you connect your phone, one for the phone itself, and one for the card inside the phone, make sure you pick the card.
Click on details, and here is where you set conversion settings and pick any playlists or smartlists. I suggest you select high quality portable. small files, reportedly no compression can be heard in the resulting files.
I created a playlist group called Devices, and all of my device smartlists are in this group. I just check the correct one for the correct device and viola, it syncs that smartlist to the device and I'm good to go.
play around a bit and you'll get it all worked out, I'm sure