You are correct. KnownHost monitors the node, not individual VPS on the node. But KnownHost VPS setups are very good and you should not have a problem. Monitor your memory usage and upgrade when applicable. Services like Pingdom can notify you by text when they find a service down on your VPS.
KnownHost performs backups that only their techs have access to. They will restore the entire container to a point in time. You should provide your own backups in case you want to restore individual files or accounts instead of the entire container.
You have to first have a cPanel account set up in WHM to access that account via FTP. To do this, use your browser to access your WHM as per the email instructions.
I believe that's a CSF function. You don't want to disable that as it is always a good idea to know when and what IP is accessing your VPS so you can take appropriate action if you're VPS is compromised.