They are there to make the auger look smoother and a little rounder. The staircase created by the upside down dark prismarine stairs was too harsh, so I tried to smooth it. Another layer of stairs would have made the auger too thick and levers, which would have made a nice slope, would have messed up the overall appearance. Levers also didn't match colorwise.
So, I needed some block to make the auger look more sloped and less rough that also matched the colors around it. Banners swing back and forth, so sometimes they create a slope (it's steep but not as steep as the 90° slope created by the upside down stairs, so it actually has a smoothing effect, even if it is small). They also are a little less wide than the stairs and have some amount of depth, so they make the auger rounder, too. And they match everything around it quite well colorwise.

No problem! Okay, so you downloaded a schematic file (it ends with .schem) of the build. Now you need a program that can read schematic files and lets you put the build saved in the schematic file into the game.
There are several different programs that can do that but I would recommend using World Edit. I've used World Edit ever since and never had any problems.

If you decide to use World Edit, there is a mod (for single player) and a plugin version (for multiplayer) of it. Download and install whichever works best for you.

Now, go ingame and execute following commands (you might have to give yourself op to have access to them):
//schematic load <name of schematic>  (this will load the schematic to your clipboard)
//paste -ea  (this will paste the schematic ingame with entities and without air blocks)

I'm not exactly aware of tractors being made out of wood. Or do you mean a toy tractor?
In any way, I made quite a few tractors now, so it would have to be very different from all the tractors I have made so far.

Yes, I try to give them a good amount of detail which makes them look more interesting and more realistic. It also is more fun to build if there is more detail :)