Ok. As you have surmised, you cannot use Dreamweaver to edit the .htaccess file. Use Textpad or something that will save as pure text.
Ignore the prefix, that’s just if you want something added to the link when the link is created. The friendly URL link is made of the prefix, the page’s alias, and the suffix (usually .html).
You should not have to change anything at all in your .htaccess file except the one line:
That line is for one of my development installations. My full path is /Applications/MAMP/htdocs/0962. The htdocs folder is my "web root". If I had MODx installed there directly, the RewriteBase value would simply be /.
What I’m telling Apache is to apply my rewrite rules starting from that point. Apache only messes with what is in its web space (anything inside that htdocs folder in my case), so Apache’s web root is that folder. They can have different names, public_html and www are other common names. They are all represented by the /. Any time you want Apache to start from a different point, such as a MODx installation in /Applications/MAMP/htdocs/0962, you have to tell it where to start, in this case /0962.
You can uncomment (remove the # from the beginning) the line above that, the one that says
Some servers need it, some don’t , but it doesn’t hurt anything if it is there.