My answers are based on experience, research and info from my doc.
1) The higher up your inflammation is on the colon, the more looser your stools will be?
Yes, many with UP have constipation as a symptoms. Constipation is a many times a first sign of the start of inflammation in the rectum .
It does depend on how high one's UC is to start, and if one has been diagnosed with UP initially and then has diarrhea, I will bet "dollars to doughnuts" that the inflammation is spreading higher.
2) If you are producing solid stools but still have to go to bathroom 4+ times a day, does that mean your inflammation is probably just localised in your rectum area i.e. you can't 'store' the stool.
Solid stool while flaring would mean the inflammation is getting controlled even if it extends beyond. It could also mean you're eating enough foods that encourage stool formation and are absorbing enough of the water, especially if going 4 times a day. I would deduce if it were me...that inflammation would be limited to the rectum and that I was still flaring, especially if I was eating normally. If I had urgency, however, it would mean I still have inflammation. There's urgency that can be held in for a short while and urgency that will be out asap.
3) What's the significance, if any, of never having pain from your UC? Is the lack of pain a positive sign relative to the condition.
It would depend on where the pain is....in the rectum, in the sigmoid, on the right side..etc...during a bm, after a bm, between bms.
Pain can be caused from inflammation or from foods that create too much gas. Some foods will increase peristalsis. Sometimes when the colon is inflamed there's spasming. Add food, not a good combo. Sometimes those with UC have IBS...both can create unbearable cramping and pain.
I think the lack of pain is a positive. I have different pains/cramps when flaring and when not flaring. A lot depends on what I eat...and there's interesting consistency. It ends once it's out..so to say.
I have more discomfort during flares when I have just rectal inflammation than when it's been higher. Two reasons....1)with lower inflammation I have more stomach discomfort.
2) With higher inflammation I have looser stool, which goes through the inflamed rectum with a bit less discomfort and pain than with formed stool.
oh, I read in the ccfc newsletter (many years ago) than UC isn't painful. interesting reading while on the toilet and white-knuckling it through a pencil thin poo that feels the size of a watermelon. Nah, no pain at all. 
quincy
*Heather*Status:mini flare June 23* 6asacol daily+ Salofalk (tapered every 3rd night)
~diagnosed January 1989 UC (proctosigmoiditis)
~5ASA: Asacol + Salofalk enemas (increase for flares tapered to maintenance)
~Bentylol (dicyclomine) 20mg as needed
~vitamins/minerals
~Probiotic 2 (Natural Factors Protec) + 1 (Primadophilus Reuteri) at bedtime
~Natural Factors Multi Digestive Enzymes with supper
~Ranitidine,Pariet (reflux) Effexor XR 75mg; Pulmicort/Airomir (asthma)
~URSO for PSC (or PBC) 500mg X 2 daily (LFTs back to NORMAL!!)
My doc's logic.. "TREAT (FROM)BOTH ENDS" worth it !!!