"1. i already have plenty of arctic silver 5 paste on it"
This could be part of the problem... You don't need much thermal paste at all to keep processors cool. Basically, just a little bit on your finger smeared on the die... I'm sure GPUs are the same.
That's right. The die is actually the internal core (the processor) inside the chip. The chip contains the die, L1 Caches, L2 Caches, Hypertransport (on AMD64s), and integrated memory controllers (Sempron and AMD64/Opterons)