Since we request that you post one question at a time here on eNotes, I will answer your first question. The grisly sight that Orwell sees when he reaches the quarter where the elephant has been seen is a dead Indian man who has been killed by the elephant.
In the story, Orwell is being guided to the area where the elephant has been seen. There does not appear to be any evidence that the elephant has even been there and Orwell is on the verge of deciding that the Burmans have just made the story up. At that point, he hears a commotion and, upon coming around the corner of a hut, he sees the dead body. The man had just been killed. Witnesses said that the elephant had picked him up in its trunk, thrown him to the ground, and stepped on him. Orwell describes the sight in detail. He says
This was the rainy season and the ground was soft, and his face had scored a trench a foot deep and a couple of yards long. He was lying on his belly with arms crucified and head sharply twisted to one side. His face was coated with mud, the eyes wide open, the teeth bared and grinning with an expression of unendurable agony.
He goes on to say that the man’s back had been skinned by the pressure of the elephant’s foot. The scene is clearly quite grisly, and Orwell describes it in enough detail to make the reader feel viscerally just how horrible it must have looked.