Trying to figure out server setup - AWS

I'm a long time unity developer and user of the photon cloud and PUN, but never setup a server in the past. I'm looking into how to host a photon server on AWS using the EC2 service. I do not have a background in server systems, IT or databases so a lot of the language thrown around is foreign to me.

I've done some digging and trial and error on my own but haven't been too successful so far. I managed to setup the EC2 instance on AWS, and have read a little about the server sdk and requirements. This has raised some questions.

1. To install the server, I'm guessing I just download and install the server SDK directly onto my instance, through remote desktop, is this correct?

2. Under the development requirements for hosting a server, it windows 8.1 x64 is recommended with .net 4.5 and MVS 2013, does this mean I need to install them on the machine I typically do work on, or on the server instance? Do I do the editing directly on the instance or on my local machine and send updates that way?

Hopefully from there I can get going, I'm just having trouble with learning the setup process while not fully understanding the server hosting itself, in addition to learning more about AWS at the same time.

Thank you very much for any help and advice, I really do appreciate it!