What are the extra things I can do to earn Sega Miles

All you'll need to unlock the higher tier licenses is a ton of Sega Miles. You'll get Sega Miles at the end of a race whether you win or lose, but winning gives you more. The mile requirements are for total miles earned, so you can spend your miles without worrying about making the next license harder to get.

The license ranks are:

• Blue - 50,000 miles
• Amber - 100,000 miles
• Red - 150,000 miles
• Bronze - 300,000 miles
• Silver - 500,000 miles
• Gold - 750,000 miles

As getting these licenses are trophies/achievements, most of this info comes from the PS3Trophies page for this game.

The "[Number] Player" refers to the level of split-screen mode you're in.

So if you set it to "One Player," you'll force lower quality models (and prebaked shadows it seems) in all game played. If you set it to "Two Player" and it'll only reduced the quality when you play multiplayer (2P and above), and so on.

It's a nice way to allow people to use better graphics in single player and lower the quailty in split-screen modes, so you can maintain a decent framerate.