I'm confused about the WifI Sleep Policy...what does it mean for wifi to sleep; does it mean to stop searching? Mine is currently set to "when screen turns off", but I've seen others suggest that it be set to "never".
wifi sleep policy means that it will completely shut off when the screen goes off. The phone will use the 3G connection when wifi is asleep for any data requests. I verified this by looking and my data usage on verizon's website. My data usage dropped significantly when I set the wifi sleep policy to never. I also saw significantly less battery drain. You're basically saying always try to use wifi when it's available. The only thing to be aware if you set your wifi to never sleep is that when you are not within range of a wifi area the phone will go into search mode which will use more power. So I use the HTC wifi widget to easily toggle the wifi off when I won't be near a wifi area for a while.
You don't have to download a power widget to turn wifi on and off. Long press on one of your home screens and select widgets then "Power Control". This gets you a widget that lets you turn on and off several devices (wifi, GPS, Bluetooth, syncing) as well as adjust the display.