How hard is it to get used to drawing on the pad while looking at the screen?
Since the pad itself doesn't display any graphics (Unless I'm mistaken here?), if you lift up the pen and want to put it back down again to continue drawing, how do you know where to put it back down? This always confused me about these pads.

In my experience its not too bad once you get used to it. Some people claim to never want to go back after getting a cintiq though.

I have a Wacom Bamboo and it works rather well for my needs

the bamboo worked well enough for what I got it for. But as I want to do more freehand drawing it lacks a lot of the precision that I'm used to with pencil. Maybe the intuos will help partially alleviate that.

Since the pad itself doesn't display any graphics (Unless I'm mistaken here?), if you lift up the pen and want to put it back down again to continue drawing, how do you know where to put it back down? This always confused me about these pads.

With Wacoms there's a "catch distance" for the pen, so it'll show your pointer/mouse without being used as if it were clicked. Then when you actually put pen to tablet, it continues drawing/clicking. I.e. if you hover less than an inch above the pad and move around, you'll just see your mouse zoom around the screen without doing anything.