How exactly does it work and what does it mean if the knock Retard Alert indicator was reading "Spark Retard = 5.0" in most of my WOT runs? Is that 5 degrees of timing being pulled @ WOT?

 

I believe so

 

Also I wonder what the knock count is? Is that the total amount of knock the computer has seen since last reset?

 

The knock counter is a continuous counter that "rolls over" to zero when it reaches a certain threshold.

You should review the time frames in your data log to see when the timing is being retarded and how long it stays retarded.