Thanks popatim. I got the fan back in and running.
1. I got it to seat tight.
2. I must have either misunderstood the video instructions or my fan is backwards. I kept trying to start with the arrows in a position that I would turn them counter clockwise to lock them. I finally decided to try it the opposite way and that locked them down.
3. The fan appears to be fine.
4. A local computer shop sells a packet for a buck that has enough to do a couple of systems. Good thing since I put too much on the first try and it squeezed out the sides. Note: Clean the old stuff off first with rubbing alchohol, or vodka if you are having as much trouble with the fan as I was.