1. It has crashed because the mod failed to apply correctly, OR, the window size didn't match the resolution it was expecting. That version of Cafeteria relies on a memory hack in order for it to work, and unfortunately, sometimes it doesn't. You can disable the mode skip, that's ok. When that dialog appears, is one of the selectable resolutions on it the one that you chose in Cafeteria? I have solved this issue with a patch which isn't yet available but will be soon.
2. The current version of Cafeteria uses the backed up wads as the base game and then applies the mods on top of that. If the mods haven't been applied in the backup wads, they will be erased when the game next rebuilds and launches. The upcoming version of Cafeteria works differently, and manual mods won't be erased.