1. Well Lusaka Dynamos are a Club that are in debt, struggling financially and are even currently serving a FIFA transfer ban (mainly due unpaid transfer fees, unpaid players etc.). The Zambian FA has also suspended them from participating from the Top Flight division and it was also rumored in the 2023 pre-season period that the club might go into liquidation. @BeeInExile knows more about their situation and will be able to explain it further if you like.
2. Yes, Young Lusaka Dynamos is currently playing in Lusaka Division 1. But what I think now is that actually could be the 'new' Lusaka Dynamos main team but I guess they didn't change their name/registration before the league kicked off, because up until today it is still Young Lusaka Dynamos (even now battling for relegation survival) and as of what I know Lusaka Dynamos are currently not participating in any league. In Zambia affiliates actually participate in the same divisions as parent clubs but I the editor is bugged/hardcoded and created affiliates can't participate in the same league as the main team.
3. It should be 8 teams in total getting promoted so I actually find that strange that only 4 get promoted in the first season, I'll try look in the editor to see if there's something not right. And on it been the same teams, what I noticed is that when a league is inactive usually the teams with highest reputations get promoted. I'm not sure if it's all inactive leagues but I have witnessed that enough times.