Here are answers to your questions:
Is the PHP API available immediately to my account to use with the 5 free credits?
Yes, 5 free credit can be used from the PHP API.
Can I switch my account from economy to Direct? Reason being I would like to avoid the credit expiration.
Yes, just click 'Change' next to the Service on the Account Login Status Page
Is it possible to buy credits in batches of less than 500?
Yes, Only on the UKDirect service
What is the purpose of and how does one use the script ReceiveMMS.php in the PHP API?
For receiving message from Mobile phone into your own system