This question is a follow-up to an older one about a proof of Rickard that the stable module category can be described as a triangulated Verdier quotient. In fact it's a complemented in that this question asks for clarification of every point that the previous question didn't touch upon.
Setup:
Let $A$ be a self-injective algebra (so projective = injective for modules) and let $D^b(A)$ and $K^b(A)$ be the bounded derived category and the full subcategory consisting of the perfect complexes (complexes whose modules are all projective). The singularity category is defined to be the quotient $D^b_\mathtt{sg}(A) = D^b(A)/K^b(A)$.
Next let $\mathtt{stmod}(A)$ be the stable module category. This is the category whose objects are homomorphisms and whose maps are module homomorphisms modulo those that factor through a projective.
Question 1 (Resolved in comments):
In his paper "Derived categories and stable equivalence" Jeremy Rickard proves that the stable module category and the singularity category are equivalent. The functor $$F\colon\mathtt{stmod}(A) \to D^b_\mathtt{sg}(A)$$ sends a module $M$ to the complex which is $M$ in degree $0$ and $0$'s in all other degrees.
Rickard proves in two sentences that this functor is an exact functor.
A distinguished triangle in $\mathtt{stmod}(A)$ is a triangle $$X \to Y \to Z \to X[1]$$ coming from a pushout diagram of modules $$ \newcommand{\ra}[1]{\kern-1.5ex\xrightarrow{\ \ #1\ \ }\phantom{}\kern-1.5ex} \newcommand{\ras}[1]{\kern-1.5ex\xrightarrow{\ \ \smash{#1}\ \ }\phantom{}\kern-1.5ex} \newcommand{\da}[1]{\bigg\downarrow\raise.5ex\rlap{\scriptstyle#1}} \begin{array}{c} 0 & \ra{} & X & \ra{} & I & \ra{} & \Omega^{-1} X & \ra{} & 0 \\ & & \da{} & & \da{} & & \da{} & & & \\ 0 & \ras{} & Y & \ras{} & Z & \ras{} & \Omega^{-1} X & \ras{} & 0 \\ \end{array}$$ where $X \to I$ is the embedding of $X$ into its injective hull. Since short exact sequences of modules give distinguished triangles in the derived category, and since $FI = 0$, $$FX \to FY \to FZ \to FX[1]$$ is a distinguished triangle.
Could someone clarify what is going on here? I can understand that $X \to I \to \Omega^{-1} X \to X[1]$ and $Y \to Z \to \Omega^{-1} X \to Y[1]$ are distinguished triangles in $D^b(A)$ and that $FI = 0$, but I entirely fail to see how this gets to the conclusion.
Update: This question is now resolved. One uses the defining property of $D^b(A)$ to infer that we have distinguished triangles $X \to I \to \Omega^{-1} X \to X[1]$ and $Y \to Z \to \Omega^{-1} X \to Y[1]$. Passing to the singularity category, $I$ gets killed, along us to deduce an isomorphism between $\Omega^{-1} X$ and $X[1]$, and hence an isomorphism of triangles between $Y \to Z \to \Omega^{-1} X \to Y[1]$ and $Y \to Z \to X[1] \to Y[1]$. The latter is therefore distinguished, and so by shifting, $X \to Y \to Z \to X[1]$ is distinguished too.
Question 2 (Resolved in comments):
Next, it's proved that the functor is full, where he claims the following.
... no non-projective $A$-module is isomorphic in the derived category to an object of $K^b(A)$.
But this seems unlikely to me. If $M$ is a non-projective $A$-module then $M$ admits a projective resolution $P^* \to M$ and if $P^*$ can be made finite then it's an object of $K^b(A)$ quasi-isomorphic to $M$.
Question 3 (Resolved in answer):
Later on, Rickard proves that the functor is essentially surjective. Every object $X$ in $D^b(A) / K^b(A)$ is isomorphic to a complex of projectives $P^* = \cdots \to P^r \to P^{r+1} \to \cdots P^s \to 0$, where $r < 0$ and $P^*$ has zero homology in degrees less than $r$. The previous question already touched upon the fact that $P^*$ is, in fact, not in $D^b(A)$, so I'll ignore this. The natural map from $P^*$ to $\widetilde{P}^* = \cdots \to P^{r-1} \to P^r \to 0 \to \cdots$ is an isomorphism in $D^b(A) / K^b(A)$ since its mapping cone is a bounded complex of projectives. At this point Rickard writes
... and there is a complex $$Q^* = \cdots \to P^{r-1} P^r \to Q^{r+1} \to \cdots \to Q^0 \to 0$$ which is the projective resolution of some module $M$ and whose natural map to $\widetilde{P}^*$ is an isomorphism in $D^b(A) / K^b(A)$. Thus $P^* \cong FM$.
This strikes me as simply rephrasing what has to be proved, in terms of projective resolutions rather than in terms of modules. Could someone clarify what is being done here?