1 is obviously mandatory. 2 could be preinstalled. 3 could be combined, but is mandatory. 5 is stupid. 7 should be already installed if you use paypal.
End result: find the right settings area, select link fingerprint to paypal, login to paypal, swipe fingerprint to link, done.
Don't criticize FIDO based on some half-baked implementation. Any problems you have with the setup flow are either Paypal's fault or Samsung's.
That halfbaked implementation is the featured video on their website. As someone new to fido, I was trying to learn about it and their website was very confusing and this featured video wasn't a great example of the technology. Those are not good signs of the technology.
They're trying to point out that it's usable today with paypal and the S5. They have no control over the steps Paypal and Samsung require to set it up. And although the 12 steps or however many there are are not ideal, it's not as if they left the setup for the user to figure out; all you have to do is follow the video. You're making a huge deal out of some extra steps on a one-time setup.
Don't blame the technology or the FIDO alliance when that video is about the S5 and Paypal, and the video is hosted on Paypal's youtube account.
The new yubikey neo (as of October) supports FIDO, but I don't know about client (browser/mobile) support middleware, and it requires nfc or full sized usb.
[0] https://fidoalliance.org/adoption/videos