Oracle Database Discussions

I am a newbie and I need to copy an oracle production database onto the test server.The test environment needs to be in sync with the production database(So I guess I have to do a full back and restore.I would like to do this online(hot backup so that all users have access to the database all thoughout the process)

Can someone please provide me a reference or a write up on the process.
Both the test and production database are on MS Windows 2003 servers.I have an oracle 10g database version.
I would like to do this via command line(SQL statements) using RMAN.
Can I get a reference on a step by step basis.

My understanding is:
Log on to the production server:
Make sure that both the databases(prod and test) are in archive log mode.
1.SQL> select LOG_MODE from v$database;
LOG_MODE
------------
ARCHIVELOG
2.E:\oracle\product\10.2.0\db_1\BIN>rman
RMAN>connect target Username/password@XXXXX
connected to target database: XXXXX (DBID=123456789)
RMAN>backup database OR backup database plus archive log...Which of these should I run ?
This I believe creates an automatic backup process.Where are the backup files stored.Can I create a directory initially so that all the backup files are

stored in a single directory)If yes how I do this?

Test Server:
How do I do the restore process here?
If I have to rewrite the old database how do I do it?
If I want to create a new database (instance) and restore ..how do I do the restore process?
I read that I need to maintain a similar directory structure on the test environment.Can someone elaborate on this.Is it possible to restore without emphasizing on the directory structure?
Appreciate responses.

Thanks