Hi Stroller, it IS pretty easy .... once you know how (like most things).
You have the GPS - good - that's what you need in the field (as well as compass, paper map). You also need
a mapping program on your computer (Basecamp - it's a free Garmin download)
electronic maps (eg shonky - although I use andrewp's OSM map - thanks, Andrew)
BTW, waypoints are named points on your electronic map (usually corresponding to an important navigation place or feature on a paper map). Tracks are a collection of line segments that define a path on the electronic map (and marks the way you want to go on the paper map).
The idea is, before the walk, to load the GPS with all the waypoints and tracks you will need. It's possible to enter waypoints as you go but it's not the norm.
How to load them on your GPS? Well, almost never by typing in the grid reference numbers. Using Basecamp, you can create waypoints and tracks on the electronic map. Once all done, these can be dowloaded to your GPS.
So, what's the gpx and kml all about? gpx is the file extension (eg AAWTsection1.gpx) for tracks and waypoints intented for a GPS. kml is the extension for Google Earth files (and some GPSs can read them as well as gpx files - and GE can also read gpx files
)
Also, img files are maps that Garmin GPSs can display (eg Walhalla.img).
Finally, the Chapman GR numbers (eg GR408683) are Grid References that relate to a point on a paper map but it's not easy to turn them into a full GPS waypoint - possible, but not easy.
Hope this helps a little - it really is easier to learn in person - and there is a lot of other stuff not mentioned here (eg map datums and how to relate a GPS position to a paper map).