Type Dreams is distributed as a .zip file, so the “good” strategy is used - the .zip is never stored on disk, and instead extracted on the fly.
In that case, you’d see all the files on disk as soon as the download starts. They’re just preallocated at the start of the single download+extract phase. (That should answer 3)
For 2, you’d only see a second progress bar if the format was something other than .zip, so not the case here.
For 1, well, if you had a progress bar restart from zero while downloading Type Dreams, something else went wrong, and I might be interested in looking at your app log: you can find it in “Preferences” => “Advanced” => “Open app log”, from that window you can type “Open folder” to locate the file. Or you might be able to diagnose just from reading the messages :)