Xenyx 8082 into Laptop Soundcard/Asio4All/"Realtech"

I had a question about getting a soundcard a couple days back (without realizing I could just use the same setup and plug it directly into my laptop and use asio4all),
and now I have one more question/issue.

I've the xenyx 802 mixer plugged in to my computer, but even when I haven't selected asio4all, FL Studio is receiving an input from mixer.

For example, even with Primary Sound Driver or HD Real Tech Audio selected in audio, I can still hear my microphone through the speakers. When I want to record, I'll select Asio4all and then get the input from mixer.

1.) Is this something I just have to deal with in regards to my setup/factory soundcard? All I would have to do is just set the main mix of my mixer to Zero, or is there a setting i'm missing or not doing? It's just annoying because I hear hissing/some feedback

2.) When I plug in the mixer, it gives an option of Mic and Line with the factory soundcard. Should I use the Mic for the condenser mic and line for other instruments? Or would everything be line input?