Well, let's see:
1) Love2d is no engine, but it is a very powerful framework! And on top of that, we are using several libs from its official Libraries page, which truly helped us along the way. As for the GUI editor, our game isn't really UI heavy, so that doesn't come out as a very big problem for us. And even in that case: there are some nice UI Love2d libs already written. Take a look at them!
2) We used Photoshop, but there are 2 awesome tools for pixel art which we strongly recommend: PyxelEdit and ASEprite. They are not at all expensive and very easy to use. Check them out! :)