There will possible be two separate controls for monitor. On each channel there will be "monitor send". This enables you to provide a "mix" in the monitors that is different from the main front-of-house mix. Secondly there will probably be a "monitor master volume" that turns the whole of the monitor signal up and down. I bet that there is also a way to use one of the internal amps to drive the monitor speakers from the monitor signal (using the other one for mono front-of-house) and there may be a switch somewhere to send the monitor signal one way or the other. A guitar amp will usually be too sensitive to run out of a "monitor" socket, and distort too much, but if you have a big old hifi amp that may do the job.

Make sure you use a mic in front of the electric guitar cabinet, and do not use the DI off the guitar amp.   It should be possible to DI the bass.

I think the phonic has "mid-sweep" mid controls. If the guitars are a bit sharp, set the sweep to about 1,000 hz and cut that frequency about 3 db. Use ears to adjust until they sound like guitars.

The guitars should be into the ultra hi-Z inputs on the Phonics. I have found them surprisingly good in the past. Alistair ought to be able to tweak the sound of his guitar if he has the usual three band mid-sweep graphic in a plastic box on the side (and he doesn't really need the ultra Hi-Z input because his pre-amp does the buffering for him). I don't like the fishman slot-ins, but the "rare earth" models let you blend between a mic in the pickup bar and a magnetic pickup, which may enable you to smooth out the sound. Get him to play while you take the amp out in front of the speaker and listen and twiddle, and then get him to stand out front with a long lead and twiddle the knobs on the side of his guitar (or vice versa). You may be able to smooth the sound off with a little bit of echo, reverb, or chorus.

You are right that using mics on the guitars will be a disaster. Do not go there!

Don't forget that people are soggy and soak up sound so when you have people in the room you may want that bit of "bite" you are planning to remove to get a more guitar-like sound.

Tape out always sounds different, because the limitations of the speakers (and the effect of soggy people) are taken out of play.

If you put the speakers perhaps a little bit forward of as in your diagram, then you can angle them in a bit to hear yourself, and if you get feedback, angle them out a bit more.

"Ducking" is probably due to overloading an input or two (or maybe the fx unit). Keep an eye on the input level lights, and/or try turning the gain (the input gain) on the bass down a bit and the main fader up a bit to compensate if necessary, or turn up the stage amp a bit and leave the mixer input down a bit.   Same applies to the electric guitar.

Bass is deceptive. If you can actually hear it live, it will almost certainly be too loud recorded.

The open air soaks up power. Just keep turning it up until it's loud enough.