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1) The EOF_HOME is configured under the MW ORACLE_HOME as ORACLE_HOME/eof
You can use the same EOF home for many projects any many customers.
Unless this actually is a new customer and you are using the tool to manage multiple customers/projects, I would use the same customer and create a new project.
2) The first project created directory "INSTANCE_1703" under the config, log and scripts directories (1703 is the INSTANCE_ID)
Is the idea that my 2nd project will create a new INSTANCE_NNNN directory and I can then use the same EOF_HOME?
Second project will be INSTANCE_1704 - yes same EOF_HOME