RN-41 bluetooth with an arduino

Trying to understand the schematic, and make the Rn41 work with the Uno.
In the schematic I've attached from Sparkfun:
The part I've highlighted in BL: Could that be replaced with the Logic Level Converter from SparkFun (http://www.sparkfun.com/products/8745)

The part highlighted in RD: Is that just a 3.3 volt power supply? So the Uno has a 3.3 v pin, I could use, correct?

This is starting to all look pretty easy.

...what is the part I've highlight in GR?

And lastly, There are 4 pins being connected, but I thought I'd just need Rx and Tx for a general purpose 'serial pipeline'? Do I need rts & cts?