Hey emchun
So lets get some things clarified, firstly:
(a) What is osmosis?
Osmosis is the passive, net movement of free water molecules across the semi-permeable plasma membrane from a diluted area (low solute concentration) to a concentrated area (high solute concentration), along the osmotic gradient.^ What this means is that water molecules will always move from a diluted area where solute concentration is lower than water concentration, in order to dilute the concentrated area of the other side of the membrane, where solute concentration is greater than water concentration.
(b) Why the dialysis tubing?
The dialysis tubing represents the semi-permeable plasma membrane. Yes, there are limitations to this model because there are no phopholipid bi-layer aggregations, no protein/ion channels, etc. However, it is perfect for osmosis because small water molecules are able to diffuse through the pores of this dialysis tubing. So when you're observing osmosis, ensure you remember that the dialysis tubing is your plasma membrane, and exactly what happens in normal cells (e.g. osmosis in potato cells), is happening in this dialysis tubing.
(c) Iodine solution:
That indicator in set-up A of starch solution and iodine would probably turn dark blue-black. This enables the experimenter (yourself) to know that starch is present in the solution. Now the reason Set-Up A turned purple was because the surrounding water is purple, and because of the net movement of water into the dialysis tubing, its obviously very convenient as an indicator to visually see what is hapenning.
Results:
Setup A: It showed that the iodine was going into the dialysis tube as the liquid turned purple, but I'm not very sure why and how come the starch didn't come out of the bag instead? Is it because it is too big to come out?
Setup B: It showed that glucose came out of the dialysis tube because the testape showed change of colour when tested in the gas jar. Why is that? Is it because its a small molecule so it can diffuse through?
Set-up A:
Now you're asking why the starch did not come out of the dialysis tubing. Starch is a polysaccharide made up of branched chains of glucose monosaccharides. It is too large to fit through the pores of the dialysis tubing, and even in the plasma membrane, must be carried across the plasma membrane via protein channels. This is why its an advantage to use something permeable, basically to water.
Set-up B:
Yes - glucose molecules are molecules small enough to diffuse into/out of the dialysis tubing. Actually, what would have happened here is that water would have moved into the dialysis tubing, in order to dilute the more concentrated 'glucose' environment within the dialysis tubing, containing the glucose + water.
Set-up C:
This control is basically the isotonic solution; what would have happened was that you should observe no change in the mass of the dialysis tubing because there is not net movement of water into or out of the cell. Its a point of comparison, and also eliminates extraneous variables that could then enable the experimenter to attribute any effects on the osmotic activity of water across the dialysis tubing, to the independent variable, which is in your case, solute concentration.
Hope this helped, and good luck!