@Evalen My apologies first of all, I probably should've included more details, but I'll happily answer your questions! :smile:
1) In your original family, they must live out their lives until their four skills (per Sim) are maxed out (whether all of them are alive or if you use the remaining ones who haven't died).
2) No, you can't do generations for this challenge unfortunately. I don't see a way you can continue on without affecting the winning and losing conditions. However, you are more than welcome to woohoo and have children that you may not have already made in CAS. If they grow into a Teenager before you've completed the challenge, they aren't included in the challenge itself. They're just sort of there, but still have to follow the guidelines of the challenge (even as a child); such as not going to school and they're allowed to have a certain part-time job. They just won't have to max out four skills like the other household members. You're still welcome to include them into the challenge if you want, but it's not a requirement for the win.
3) Your quarantined Sims cannot marry, no. If you want to have Sims with a husband-wife relationship, you must modify the Sims' relationships yourself in CAS at the time you are creating the family. If you do make two Sims who aren't married, but want them to be eventually after they're boyfriend-girlfriend, you can wed them by having a private wedding at home, but not at a venue or community lot (and you can't invite Sims outside of your household for the wedding).
4) Yes, your Sims may go fishing as long as the pond is on their own lot.