With the system we use the felt (30 lb) goes down first and then the walls are framed on top. The denarco sure seal goes down in between the felt and the bottom wall plate. With the gasket in place, the felt actually "bonds" to the Advantech under the weight of the wall. Sill seal typically is either a closed cell foam or a fibreglass insulation. The weight of the wall ruptures the closed cells and when that happens, it looses its memory capabilities rendering it pretty much useless as a forgiving seal.. The fibreglass insulation just plan leaks. The beauty of the Denarco gasketing is that it is an open cell urethene impregated gasket. Being open cell allows it to open up to whatever gap needs to be filled (depending on the gasket size) and the urethene impregnation makes the gasket airtight when subjected to 60% compression. This allows for a forgiving seal as wood expands and contracts. Caulking under a sole plate is better than nothing, but pretty much a band aid, in regards to longevity. The only kind of caulking that is forgiving is Tremco Acoustical sealant. We call it "black death" because its so hard to work with, without getting it all over everything. 30 lb felt is durable enough to withstand most of the rigors of construction. Care should be taken to "orient" the staple direction for ease of removal later, and you should staple within the last 1/2" of the felt, otherwise too much debris gets under the lap, causing the staples to tear loose. 15lb felt isnt worth the effort.

Kinda looks like vinyl sheet flooring. Either way you must take up the flooring and scrape it very good. If its tile I would rent an air hammer with a flat chisel. After the floor is clean check for dips and bumps ( level is not so important) and level it out with floor leveler. Floating floor is a simpler option but I won't touch the stuff and you will get a more possessional job with engineered glue down. Better resale also.

Install your tile over the concrete, don't use a wood subfloor. The flexibility of a wood subfloor allows to much movement which will crack your grout and tiles. Concrete is a much better subfloor for tile. Depending on how out of level your floor is, you can probably use a self leveling concrete compound that will take care of the out of level situation. Does the floor have moisture problems at the moment?

What type of underlayment are we talking about? Is this 'real' plywood or is it OSB? There are enzyme treatments out there (forgive me...I don't have the names handy...someone else will chime in and offer a name) that can be used to neutralize the odour. Once the odour is neutralized, many people will seal the plywood/OSB with a primer like Zinsser. The two things combined usually do the trick. Of course the way to get 100% removal of the stains is to remove the top layer of your subfloor floor and reinstall new plywood....but that's now what most people want to do. What is your new flooring going to be?