1. Explain how the point of view is constructed.
The point of view is basically the position of the composer on the issues being discussed. To answer this question is to, basically, how they use techniques to present that perspective!

2. How is point of view used to position the reader?
Essentially, this asks you to extend the above argument to the audience. How is the audience impacted by the perspective presented above? At least, that's how I interpret this

I was also wondering for simple language what effect does it have on the audience? I wrote that it is a reflection of a passive character. Blunt to the point?
I'd say simplistic language allows the audience to easily engage with the argument being presented. In some cases you could say it is used in a degrading manner, over simplifying an issue may indicate that the speaker doesn't think highly of the audience's intelligence. It can become condescending! Usually though, it does just indicate "blunt and to the point" as you say

What would be a good example of embellished language? Would what I have written for its effect 'Excess exaggeration and maybe too excited can lose the audience’s attention. On the other hand it can gain the audience’s attention.' be correct?
So tread lightly before you assiduously malign the veracity of my etymological prowess. ^ A quote from Modern Family, a perfect example of embellished language, lots of fancy words

you could also include language with lots of description, or excess of use of other techniques in this category. Both of your interpretations are definitely correct, depending on the situation at hand!

I am also having difficulty defining Language choices.
Also would this be a good example?: “Oi mate, who was it?” versus “Pardon me, who was at the door?”.
Effect:? Though both sentences express the same idea, language choice give them different feelings and connotations – they would not be said by the same character.
Sounds excellent to me. The same thing said in different ways evokes completely different responses

language choice is literally just the choice of words/expression to convey an idea!

I am still a bit confused on the effect of colloquialism on the audience. It usually shows comfort with the person they are speaking with, or can be used as a way "in" to someone - showing that you're friendly and casual? -> engages reader?
Correct

For Informal or formal register what would be some examples and the effect on the audience?
A perfect example of formal vs informal would be that example you used above with the person at the door. The second one is using very formal language, the first is definitely formal. The effect depends a lot on the occasion. If, for example, Malcolm Turnbull used informal language at a UN Conference, then the effect would be offensive and degrading to the significance of the occasion. If used in a small town speech, it could be as a way to promote greater sympathy for his character, develop a relatable ethos

Use of nicknames engages the audience?
Yes, and if it isn't the audience with the nickname and they aren't told what the nickname is, then it can create an exclusive effect
