First question is easy. The WiFi simply replaces the ethernet cable we used to have connecting the Slingbox and the router. One less cable to have cluttering up the system.
Second one is a bit more difficult as I am not sure what you are asking. If you are asking why only one person can watch a Slingbox at a time, I can only assume the Slingbox has to setup a 2-way synchronous communication with the user to send the video stream one way and receive the commands and status reports (so it can adjust the video settings) the other way. Maybe a technical engineer can give you a better answer.