If you go Greek, as earlier noted, the answer is a hard “K”. So Chaos and K’thonos (both of which are actually real words, not just tongue twisters I made up to infuriate GooglePlay reviewers). But I’ve never been picky about canonical pronunciation, and IMO the people who’ve been pronouncing Xaos as “Zaoss” have awesome on their side.
So the only way you can have a Xaos companion other than Yed the one-armed bandit is to successfully evade or defeat the army sent after you in the woods. If the Phalangites and Theurges end up scattering you and capturing any significant amount of your rebels, you’re just going to Xaos in Yed’s company. Breden would in that scenario (if alive) be one of the scattered and fleeing rebels in the wilderness, and would reappear in Game 2 Ch 2 as a leader of the ongoing “Rim Commotion” (the name assigned to your revolt in other parts of Shayard).
Depending on your choices, the Xaos-landers could end up being one of the factions in the final Game 5 disposition. Expanding the Hegemony to include the Abhumans, Halassurqs, or Unquiet Dead is likely to be impossible – it’ll be work enough just to replicate it, let alone absorb a major neighboring power! – but we’ll see.
Some will always see them that way, but you’ll have the option to try to promote a syncretic understanding – though as Bryce says, you’ll be swimming upstream against a thoroughly unsympathetic majority religion. Regardless of your choices, one of the major new religious movements that fires up in Game 3 (as a potential pacifist rival to your rebellion) will involve some syncretism between Xthonism and the Abhuman faith.
Yes, Ghaesh is a non-believer, though his devotion to knowledge approaches a level that some might consider religious.
You can either reproduce something like the Hegemony’s Plektoi – which as Ramidel noted in that Laguz quote were built by humans according to the Rule of Scary and are thus massively inefficient – or if you’ve become sufficiently friendly with the Abhumans and learned their arts, you could design much more efficient Theurgy-beasts (which would however completely sever your relationship with the Abhumans, who believe plektosis is only OK if you’re doing it to yourself).