Hi Rob,
Thanks for the questions. Looks like I need to update the description for the Top Posts module

.
"...link directly to the topic"
I take it topic means thread?
Does that mean that the reader is taken to the start of the topic/thread only and not to the page that the specific post is on; eg the last page of the thread?
This has changed. If you have to the TopPosts module set to display the latest post, it will take the user directly to that post within the thread. If you have it set to only display the latests Topic(Thread) then it will take them directly to that topic.
I take discussions to mean threads and posts to mean posts?
Yes
If it display 5 latest threads, are they from a selectable group or simply the 5 latest overall?
You can select the forums from which the module will pull the latest Topic/Posts. It will pull the lastet overall from the forums you specify.
If it only displays latest posts, are they from selectable groups, threads, forums as a whole?
They are only selectable from forums. The module options displays a list of all your forums and you just check which ones to include.
"5"
Can this number be increased to say, 6 or 10 or X?
Yes, you can make this number whatever you like.
On my homepage I want to display the X actual most recent posts to the entire forum and let the viewer go straight to the actual post that is being displayed. Is this possible?
Yes, this is possible.
Alternatively, on my homepage I would like to display the X most active topics. Is this possible?
Yes, but through an additional module that is currently being tested.
I assume this means that one needs RSS feeds available at different levels of the hierarchy. Is this the case and are feeds available at all levels or if not then where are they specifically?
RSS feeds are available at each instance of the TopPosts module depending on your settings. The RSS feed will match what is being displayed for the module. RSS feeds are also available at the forum level as part of ActiveForums.
Also, is the entire module able to be syndicated using DNN's own syndication tools? This might get around not having a top level feed if that is the case.
I haven't had anyone request this feature, but I'm sure it wouldn't be difficult to add.
Also, is the amount of decription text displayed adjustable to a certain number of characters?
Yes, you can customize this setting. Also, the TopPosts module is template driven so you can customize the layout.
I hope I haven't missed anything. Please let me know if you need any more details.
Thanks,
Will