You can use just a bit of water to stick the fondant to the foam. Some people use crisco or piping gel.
I would soften the sharp edges on the foam by rolling on the counter, or using the palm of you hand or small rolling pin. I just sand lightly with fine sandpaper. When you are just starting out the sharp edges can tear your fondant quite easily.
I use a bit of piping gel in the middle of the layer to stick a tiered cake together.
I just did my first dummy cake, and I just used a thin layer of BC because I didn't have anything else made, and I tried water without much success (and I wasn't really worried about re-using it afterward). One thing I found really annoying (be prepared for it) was how hard it was to keep that darn thing from moving because it was so light. Finally put a dollup of royal icing on my turntable to help out a little bit! Have fun!
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