1. To sculpt with bread (the technique is similar to sculpting with clay and similar materials). It's a popular pasttime in Russian prisons, so it's funny, because this guy is teaching the kids his prison hobbies.

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2. It's a bastardized version of a traditional folk tale "Курочка Ряба".These kids are way too old for it, though. It's usually told to 1-3 years olds.

Жили себе дед да баба,
И была у них курочка ряба.
Снесла курочка яичко:
Яичко не простое,
Золотое.
Дед бил, бил —
Не разбил;
Баба била, била —
Не разбила;
Мышка бежала,
Хвостиком махнула:
Яичко упало
И разбилось.
Дед и баба плачут;
Курочка кудахчет:
"Не плачь, дед, не плачь, баба.
Я снесу вам яичко другое,
Не золотое — простое".

3. Стать is used in its meaning "to start doing/being something". Basically you can replace it with "быть" in this case.
eg.
Когда я вырасту, я стану пожарником.
Они не станут со мной разговаривать.
I.e. "Well, people won't (start) gossip(ing) without reason".

4. I have no idea. ) Maybe it's because the kid is acting out (the boy obviously knows the answer and wants to goad the guy)

5. Пятачок refers to a snout. Russian черт (lesser demon) looks like this (he has a pig's snout, a tail which is often tufted, two small horns and hoofs):



PS. I remember a funny episode. When I was a kid we were asked to draw an illustration to Lermontov's poem "Demon" (which depicts Demon as a dark and beautiful being), and most kids drew little hairy things with snouts. Our romantically inclined teacher was taken aback. ))