So as far as I know....

Staking is when someone else puts up your buyin - I guess it could be a multiple people or even a combination of you paying for part of it as well - and there is an uneven split of profits usually anywhere from 50/50 to 70/30 in favor of the backer. And the player is not expected to cover losses out of pocket, but does go into makeup if he loses.

Selling Action is when you want to play a tournament above your bankroll so you then sell off a certain % of yourself. In this case 1% bought = 1% of total profits. Is this right?

So now the questions:
1 - What happens with expenses in the case of live tournaments?

2 - If my definition of selling action is correct then what's the point? Why not just play in a smaller tournament? I guess the only reason to would be that there is a huge prize pool that you'd rarely ever see at the stakes you played?

Reasons I'm asking are a couple:
1 - I've been playing and running pretty well in MTT's over the past couple of months and was considering playing in a couple of FTOPS events next week, but they're still above my comfort level for the buy-in if I don't satellite in.

2 - A friend and I were talking about possibly playing in a couple of live $200 - $500 buy-in tournies in AC this summer where we would split the buy-ins, but only I would play. Taking the expenses (travel, lodgeing, food) into account I have no idea what to offer as a fair and proper arrangement.

I dont have an amazing knowlege in this area, but your definitions look right, also I dont think travel expenses should really be put into the equation when selling action, but damn if you can get your backer to do it, by all means.