CentOS as well as Oracle Linux are both based on the corresponding RedHat distribution. So to answer question 1: a third option is to install SOA Suite from scratch on Oracle Linux 7. Read great article about why: https://oracle-base.com/blog/2018/09/10/which-os-is-the-best-for-oracle/ . I don't see why you would reinstall it from scrach in the Oracle-provided VM.
2. You absolutely need Oracle DB. But it can be an XE database. Read this for the pre-requisites: https://docs.oracle.com/middleware/1221/core/INSOA/GUID-16F78BFD-4095-45EE-9C3B-DB49AD5CBAAD.htm#INSOA-GUID-16F78BFD-409… Especially the section about the required Linux packages. Although the Oracle installer would check on it. As a rule of thumb you might expect that if you system is ready to install an Oracle Database, you may expect it is good to go for SOA Suite. You could also use the oracle linux vagrant box: https://yum.oracle.com/boxes .
3. Because the installer expects an empty home. But why would you want to reïnstall? The 220.127.116.11 already is the courant version.
4. You could do that. You can also update the setDomainEnv.sh in the domain and the setWlsEnv.sh in /u01/app/oracle/fmw/wlserver/bin (or somewhere near to that).
5. The VM has start and stop scripts to have it all running. But check with ps -ef|grep AdminServer if the AdminServer is running. Normally it runs on 7001, so you could then navigate to http://localhost:7001/console. Then logon with your administrator account and see if your servers are running.