1. Should I first set up the native exchange app and sync with my Exchange server , or
2. Install and sync with Touchdown and bypass the native app?
It's all a matter of personal preference. I'd suggest starting with the stock app to see if it meets your needs. If it doesn't then consider the other Exchange clients. Touchdown is always recommended in these threads but it's not the only option out there. Definitely take a look at the others such as Moxier, RoadSync, etc. Take them for a test drive and see if any of them suit you better than the others.
I prefer Touchdown. Others prefer Touchdown. That doesn't necessarily mean that you will.
If i do #1 first and find it's not doing all that WM did, should I hard reset the phone and then install Touchdown so I don't risk duplicating contacts?
No, just remove the account and you'll remove its associated contacts, etc.
I also have a concern with duplicate contacts using Touchdown.
Not an issue. Touchdown only syncs your Exchange contacts and they're not even stored with the other contacts on your device.
Touchdown states that "contacts in TouchDown are maintained in a database that is separate from the phone’s native phone book.This means your exchange contacts are not recognized by the phone book and the other applications like dialer. This prevents functions like Caller ID to not function.
To overcome this problem you must copy the contacts from TouchDown to the native phone book on the device."
Does the above mean that I would have to copy Touchdown contacts to the native phone book on a regular basis? I add a few contacts a week to Enchange.
I think I initially set up the stock app to sync with my Exchange account to deal with this. I was
only syncing contacts and not email or calendar, etc though. IIRC, at some point it wasn't an issue as I could use my Touchdown contacts without actually having those contacts in Contacts on the phone itself. I'm a bit hazy in my recollection on this though.
My current setup probably isn't relevant to you but I'm no longer doing that as I need my Exchange contacts synced with my Google account (mainly for Google Voice) which, in turn, syncs with my device.
IIRC Touchdown has an option to copy updates to contacts to the phone contacts. If you want to verify then check out the Nitrodesk site and the Touchdown Google Group. You can get a definitive answer from the latter.
Install Dataviz' Roadsync which *will* let you sync Outlook contacts, calendar and tasks as well as email.
It allows you to sync with Exchange, not Outlook. Despite the common misconception, Outlook (client) and Exchange (server) are entirely separate. Outlook supports more than just Exchange even though people commonly assume that Outlook automatically means Exchange.
There are Outlook sync options but they're an entirely different animal.