IMO, you definitely want to import your Mass Effect 1 character into Mass Effect 2. All of the major choices that you made in Mass Effect 1 will be reflected.
For example, at one point you visit the council on the Citadel, and that plays out completely differently depending on whether or not the original council is still alive (same with the choice of who you nominated for the council, Anderson or Udina). The same goes for who you killed on Virmire (Ashley or Kaiden) and if Wrex is still alive.
The same is true for the side quests, to a lesser extent. However most of these only have the follow up in the form of an e-mail to your private terminal on the Normandy, but it's still cool to know that your choices had a lasting effect on the story.
If you had a love interest, it doesn't have a huge impact on Mass Effect 2. When you meet them, you share a brief kiss, but that's about it. You are free to have a new (different) love interest in Mass Effect 2, but apparently that will have some sort of impact in Mass Effect 3.
Bioware did an excellent job continuing the story you started in the first game. If you could make a choice in Mass Effect 1, it is reflected in Mass Effect 2.
As for importing characters, I'm not completely sure about this but I believe that you can import any play through for a given character (it's been a while since I imported my Mass Effect 1 characters). If you don't mind doing another Mass Effect 1 play through, I'd suggest starting again with your level 60 character (or whichever one you want to import), and make all of the decisions that you want to carry over to Mass Effect 2. You could always put the difficulty on easy to help things go faster.
If you want to know how a given quest affects Mass Effect 2, you can always check the Mass Effect Wiki.
If you don't import a Mass Effect 1 character, the game basically makes the big Mass Effect 1 choices for you. Also, some dialog that is present for an imported character is not present for a new character (mostly minor things, but some text wouldn't make sense if you didn't play the first game).
Finally, at the start of Mass Effect 2 you are able to change your class and physical appearance (don't worry, it makes sense in the context of the story). You can't change your sex or name, however.
From Mass Effect's main menu, select Options, then Settings, then Tutorials and finally deselect Enable Tutorials (I don't think you can deselect these one-by-one, but if you're at the stage where that's annoying you, then you should have seen them all by now anyway, and if not then they're available in the Codex).
Best Answer
Decrypting in Mass Effect is different on consoles in comparison to PC. I will cover the different variations and provide some gameplay videos on how each of the mechanics work below.
Consoles (Playstation 3 and XBox 360)
The visual 'feel' of decryption differs across the consoles but the underlying mechanic is the same. On the console versions of Mass Effect, when you attempt to decrypt you are presented with something similar to this:
Obviously this one is from the XBox version of the game (based on the button names). The object here is that as parts of the puzzle highlight, you have a small window of opportunity to press the corresponding button on the control pad (square, circle, triangle or cross for PS3). Pressing the wrong button will fail the challenge.
Depending on the difficulty you will be required to perform a sequence of between three and seven button presses.
Here is a quick video demonstrating this mechanic in action, the reaction time required is reasonably fast and I feel this is definitely less forgiving than the original PC release:
PC
For the PC, decrypting presents you with a screen that looks like this:
This is a timed mini-game with the time remaining showing in the middle (in the instance of the above screenshot there are 12.10 seconds remaining on the timer) where you must get the arrow from the outer circle to the centre without hitting any of the blocks. The red blocks will rotate either clockwise or anticlockwise, each of the concentric circles can rotate independently of each other and hitting any of the blocks will throw your arrow back to the outer ring where you started.
This video shows the mechanic in action:
Getting to the centre circle will complete the decryption process.