1.) AB automatically moves items to special bags (like herbs etc), if there are any and there is space in them. No need to do anything for that, it is automagic. :-)
2.) AB destroys grey items when free slots fall under a certain limit (default 3 slots, changeable). But it only destroys items (or stacks) below a certain value (default 1g, changeable). This has to be activated by you by entering "!poor" as pattern and "destroy" as destination. After that you can use "/ab junk" to see what will be deleted.
3.) AB lets you set every item to be put into a certain bag or to destroy it. However it will only be destroyed when free slots fall under the set limit. Otherwise it is kept to be sold later.

Usage:
/ab - open the Options frame.
/ab info - show settings.
/ab slots <freeslots> - change slots to keep free.
/ab poor <poor limit> - change the limit for grey destroyable items. You have to enter a value like '2g' or '1g 50s'.
/ab junk - show what items are destroyable with the current setting.
/ab verbose <on/off> - change verbose mode. Verbose mode tells you about moving/destroying items.
/ab special <on/off> - toggle handling of special bags.
/ab toogle - toggle Auto-Bag on/off

Take a look into README.TXT for advanced functions like user generated itemgroups.