I suspect they won't be true limit orders, but stop orders (true limit orders wouldn't slip). Also, for a passive trading algorithm its important to have level II data (the order book), or the algorithm is flying blind.
Re 1, its not the size of the data set which prevents overfitting (larger data sets actually make it more likely), but the use of it when developing/training the algorithm. Repeated testing and tweaking the algorithm will overfit, unless one is careful to maintain the complexity of the algorithm.
Anyway, best of luck to your users! But they should be warned that active trading on signals (price prediction) is the hard way to algorithmic profit. That's why market making and arbitrage is the bread and butter of the pros, not signal trading.[1]
1. said as much here somewhere in the first 20:00 http://www.youtube.com/watch?v=hKcOkWzj0_s