Any question answered...

when I try and "opt out" of google targetted advertising, it asks me to download and install a plugin for my browser. seems a strange way to go about it. I don't know much about these things - is it still collecting data but the plug in prevents the special adverts thing?

Not sure if this is working with me yet but I removed my Google history.
Go to your account settings, down the bottom you have "web history", it asks you to type your password in again, then you click on "remove web history", it also pauses the collecting too.

If they have no data collected they cannot tailor the adverts, which is actually quite annoying. If I go and buy a power tool, for the next week it will show me adverts of power tools, when I've just bought what I need...