#2
I think you are asking: if there is an "e" in standard notation, does it mean play low open E, 7th fret A, 2nd fret D...etc etc?

Well you just have to use common sense.
If the E is marked lower on the staff/below the staff, just play an open low E, or a 7th fret A, or something along those lines.
If it is in the middle of the staff, play a 2nd fret D or a 9th fret G or somewhere close.
If it is high on the staff, play an open high E or 12th fret E or anywhere close.

Get it? Just get a general area, then find a fret in that range. They don't sound two far apart when they are on close strings. And if you are covering a song, just listen and find a match. Hope this made sense. (and i hope i understood the question)
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LET'S GO BUCKS
#3
Its still really shaky for me. Sometimes I can find some of them fine but I keep having trouble with most of them. Are there any sites that baby you along to help out beginners?
#4
Here's a great downloadable exercise.
http://www.francoisbrisson.com/fretboardwarrior/fretboardwarrior.html

Here's an online-play exercise. There are tons like this.
http://www.musictheory.net/trainers/html/id81_en.html
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LET'S GO BUCKS
#5
I made up flash cards from cut up index cards.
use 5 of the lines to represent the staff and put 1 note on each card in the correct spot of the staff.
on the back I write the location on the fret board.
EX. for a note on the top last Space at the top is the "e"
so on the back I write "E @1-0"
Thats Note E played on the 1st string open
To find the notes associated with the fret board check the link from the previous post.
Most of the staff as you wrote it, assumes we wil play standard positions, but you could sub the same notes as long as they aren't to far apart I guess.
I think that has somethinbg to do with the key.
#6
The Hal Leonard series of books are good for learning how to apply notation. But to answer your question, you don't just know where to play E by looking at the staff because there are multiple places on the fretboard to play it. But most simple guitar songs are written so that you use one or two hand positions through out the entire song. The hand position determines which fret to fret. Beginers learn to sight read at first position (fore finger on first fret), then move on to fifth for a higher register then second for less common keys.