when installin updates to foobar, should i uninstall foobar and then reinstall the newer version? or can i just install the newer version over the old one? thanx.

If you are installing one 0.7XXX over top of another 0.7XXX then just install right over top. And if you use the special installer from here:
http://www.saunalahti.fi/~cse/html/foobar.html
it will even remember all the settings from the previous time you installed.

If you are upgrading from 0.6XXX to 0.7XXX then you should start fresh, as none of the 0.6 plugins will work with 0.7

Special installer was just first to be updated to remember old settings, all installers have the same feature now since 0.7 RC12.

I like the idea of an auto-update button in foobar or on foobar website which can detect your version and update as neccessary. Any chances of this happening.

Also, I sometimes like the idea of having the 7zip downloadable, is it not possible to have that on the website too?

This was already asked many times, Peter said no.