Well as for resolution, remember that you're going to end up with video, so there's no point shooting at 8mp. I use 1600x1200 in my A590. At one frame every 4 seconds, I end up changing the 4GB SD card and the batteries every 2+ hours, and that works well, and it gives me room to crop if I need to. I usually end up with 640x480 video in the end, so I really could just start with that if I won't need to crop, but I've had good luck with 1600x1200.
I use TMPGEnc to create the raw video from the still frames. It lets me specify any frame rate for input but outputs video at 29.97. So I can make the video a specific length regardless of the number of input frames. That's handy if I have a specific audio clip I want to use. I also crop and adjust gamma, etc. with that program. I usually output in HuffYUV (RGB) lossless, then go to AviSynth and VirtualDub to add the title and credit frames, fades, and audio. But TMPGEnc isn't freeware. Actually AVISynth and VirtualDub might do the whole process, but I'm just not expert enough with those to know.
Actually, Windows Movie Maker will also make the video for you, but it has certain limitations.
The frame rate really does depend on what you're shooting - how fast it moves. I've done timelapses of artists painting, and used a rate of one frame every 4 seconds, which works fine for some artists, but is too slow for others. I doubt my A590 will go much faster than that, although a test of that is on my list of things to do. I had thought of using a script that had no wait between frames, so it would say "take a picture" then loop back immediately to the same line. Basically, if the length of the final video is fixed, the more frames that went into it the smoother it will look.