worstje, to fix number 2 on your Known Issues list, have a look at AppMutex in the fine Inno Setup helpfile. There's also the CheckForMutexes support function, might you want to check it from some Code.
And here is a way to create it in C# (for if you didn't know).

(Edit: had a fight with the Code bbtag)

kryathaba, you could (re)start with a fresh script generated from the wizard, that gives you all this stuff by default...
Then add the extra files you need to add, and don't be shy to use an editor like InnoIDE or ISTool (that one is going off-line right about now) to aid in the setting of 'fancy' features like icons etc.
And don't forget to add the .ico files in the [Files] section.

As said earlier, the newsgroups are quite helpful, but we expect you to have done at least a little homework...

You could have just changed the shortcut the setup created to run the jar file from java, just like the installer (java -jar acm.jar, instead of acm.jar). The author falsely assumed you have java installed (you must have) and set to run your jar files (a false asspumption, as is any), instead of a decompressor (a jarfile has the same internal technical structure as a zipfile).