2) How am I generating these research points I have available for trade in the first place? Is it some percentage of my main research that gets converted into 'research currency'?
Each time you research a technology you get some percentage - I think 10 - of that technology's research cost as tradeable tech points.
1) When I trade 23 points in warfare for 17 points in Yithril AI's civilization tech, what exactly do I get? Are those 17 points worth the same amount of research as if I invested 17 points of 'main' research into the tech, or is there some modifier?
17 points of Civilization tech is worth 17 points of research produced normally. If you are researching in the tree that you purchased points for, the points get assigned to your current research project, otherwise they get assigned to currently-unresearched techs for which you've met the prerequisites within the tree that you purchased technology for.