1. To win the points, do they have to guess the exact word?

That's up to how strict you want to play! The short answer is no, close enough counts. If the card says "Santa Claus" and someone shouts "Santa" then that still counts!

 

2. Do you have to read all the clues in order, or can the reader skip ahead?

Clues must be read in order, from 4 points down to 1. They get easier as you go, so no skipping ahead. If nobody guesses by the end of all four clues, the team scores zero for that round