Help Setting up Static Page

I’m sure it’s been explained before, but sadly I’m not really able to understand everything I’ve read from the codex and search features, so I’ll ask here in hopes that someone can help me out.

I’m starting up a new website, and have my WP blog as the main page. (www.2fcrazy.com) I’ve been trying to figure out how to A. Make a static page that displays a small number of the most recent posts, we’ll say five or so, below an editable block of text that would be the main welcome message. Now, everything I’ve read says that you have to move all of your WP files into a directory other than root for it to work, such as /blog, and then it goes directly into telling you what to put in, but doesn’t really explain how to get to that step.

I’ve noted that if you have multiple pages you can go into the ACP and change one of them to the static page, and one of them to the page that your posts go to. Is there a way to edit that page so it displays what I want it to display as a welcome, AND have a mini loop underneath that block of text?