@Lord Santa    
> How many items can we start with?

You can start with as many items as you want, just know that items don't stack (I should add that to the post above) and that you'll probably want to have space for when you find newer, better items.

> Do you divide the 10 stat points amongst the custom stats as well?

Yes. Your stats will start pretty low. If you run out of points before you get to a custom stat, though, you can leave it at level 0 for it to gain points later.

> Does 10 items max refer to how many itens we can start with or how many items we can hold?

10 items total, but that's just because 10 is a nice number and is easier to remember. Because items don't stack, like I said above, I can be persuaded to allow either bigger pockets or let your character carry a backpack to hold more items.    
**EDIT:** *I upped this to 16 after looking at the original Earthbound item screen, which allows for 14 items.*