1. This class had us bouncing around on the balls of our feet or constantly in motion while executing different punches in front of a mirror. This was not movement in conjuction with technique, but more like cardio/step class work outs. Is this normal?
Yes. Most people do not know how to throw a decent punch until they've been taught. Watch any street fight and you'll see a lot of flailing roundhouse punches. Shadow boxing is a pretty time tested method of drilling form into people. And yes, there is definitely a big aerobic aspect to the class.
2. I declined the hand wraps, telling the instructor I don't throw strikes with my knuckles, I train to throw heel of palm strikes. He said I have to throw closed fist punches. I said I do not set-up my knuckles and fingers to be broken. Instructor said in his class I will throw closed fist punches.
We train with both, and most people prefer a palm heel for punching someone in the head. If you were there when they happened to be doing closed-fist, they expect you do that. There is no single way to do most krav maga evolutions, but they have to start somewhere, and that is usually at square one. After you have that down, do whatever works for you.
3. When in small group and being "assualted" by other student with pad in order to strike back, I did not wait to be "hit". As each student advanced on me, I immediately started striking the pad. Instructor said I was doing it wrong, I said if I see the "assault" comming I do not wait to take the first (and possibly disabling) blow. He said close my eyes, I said how can I see the assault comming/defend myself with my eyes closed. He said just do it.
Seeing the blow coming is nice, but bad guys are not always that obliging. Someone who wants to mug you or just gets mad and throws one is likely to suprise you. Any choke is going to be a suprise, since it would be pretty silly to allow someone to get their hands on your throat if you knew about it in advance. Personally I love this kind of training.
Being able to absorb a blow, and keeping your head, is a big part of surviving a fight. There's only one way to develop that, and that's to get hit.
Perhaps you are already an accomplished fighter, but the instructor cannot be expected to know that when you just walked into his class. I consider myself to be pretty decent at it, and I still go to level-one classes to work on the basics.
Training is done in a cycle, with each class being different. One day you'll work on wheel kicks and breaking a front choke, another day you might just practice a very basic punch and how to fall and get up efficiently. Eventually you'll get it all, if you miss a part of the cycle just wait for it to come around again.
The tapes are pretty decent in that they let you see the various techniques over and over from all angles with good form. To get decent practice you'll need a partner and some focus mitts & a kick shield, though. I got mine on an auction site for $60, all 5 tapes.
I pay $85 per month, to answer the previous poster. It would be more if I did month-to-month. Individual schools set their own price, they just have to keep up to teaching standards.
There is a forum at kravmaga.com where you can ask any question you want, and get better answers than I can give you.