A card "from outside the game" may be a card from your collection or a card from your sideboard. In tournament play, you can't choose a card from your collection. The cards you choose don't all have to come from the same place.

The exile zone is a part of the game, so you can't get exiled cards.

Development's effect is repeated three times no matter which option the opponent chooses. The opponent may choose a different option each time. You'll wind up with three Elemental tokens, two tokens and a card, one token and two cards, or three cards, whichever your opponent chooses.

In a multiplayer game, each opponent, in turn, has the option to let you draw a card. If no opponent does, you put a token onto the battlefield. Then the process repeats two more times. A different opponent may let you draw a card each time.