... 1) Which do you think is better and why?
Hard to choose. For the Orcas, I might lean to the 5k to get the better damping factor. See #4 below.
... 2) What is the definition of, "damping factor" and how does it effect the sound?
As Grainger said, except that in my opinion it is important for all speakers. Very few are designed for a small damping factor which is what SETs have. Some speakers will become tubby with bass lumps if the damping factor is too low; a very few that are over-damped with solid-state amps can become livelier and more "present". Sorry for the non-specific audiospeak!
... 3) Will a parafeed cap of 10uf be OK for either option?
No, the 10uF is specific to the BH-5/BH-6 combination. For the 50 henry/5K combination, use 4uF (more or less). With 40 henries and a 4K transformer (OT-2 and PC-3 as in the Stereomour) it's 5uF. These are flexible numbers within the range of half to twice the calculated value, depending on the particular speaker.
... 4) If I have a choice of output impedance, which would be better for a pair of orca's and 2 subs, 8 or 16 ohm?
As Grainger says - talk to Clark or Molly. They have a lot of experience with the Stereomour which is just a stereo Paramour.