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Looking at past forum posts people commonly experienced 1 of 3 issues: 1. The exec() function is disabled 2. The escapeshellarg() function is disabled 3. The web server cannot run mysqldump, either because mysqldump is missing from the system or the web user doesn't have permissions. I think based on your error it could be #3 since I believe the first two would cause a php error message of their own.

#7 is complete as of 4.12 with the new Extension Generator. This tools will let you enter simple extension information and generate much of the code for you, along with some helpful comments to help in development.

Ah, now that is an interesting case. The answer to your question in this case is no, it does not account for daylight savings. If you set the time to 07:00 PDT then the datebase saves at as 00:00 UTC. Then outside daylight savings the cron will see that 00:00 UTC as 08:00 PST and I suspect that's also what it would show in the interface so you would have to manually adjust it to 07:00 PST (which would then be stored as 23:00 UTC)