a) for first year, focus on your coursework, annotating FA/board review resources as you go.
b) you should know them for the boards.
c) FA is only an outline. I.E. for example, you should know the features associated w/ friedrichs ataxia (ex: cardiomegaly, GAA trinucleotide repeat disorder, autosomal recessive), all of which are not mentioned in FA.
You will have to be proactive and cover material not covered in school, as they will show up on the boards and are fair game. FA is a good indicator of an outline of what you need to know, but it is not all inclusive by any means. You will have to use other board review resources (or information from your coursework) to get the details where FA is lacking.
The further you go in your coursework, the more you will realize how relevant the information in FA is. For the most part, everything in FA is known by good internist (though there are a few esoteric details). I think that reviewing the information in FA is good in the first two years because it gets you familiar with the high points of any topic, but you can probably skip the full-on memorization until your run-up to Step I (unless you're hardcore; then you can start memorizing now). When you sit down a couple months out from the boards, that list of X-linked recessive disorders won't seem so foreign.