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and you can tell if your character is a king or duke by the color of the ring around their character portrait. if its yellow then you're a king and if its blue then you're a duke. you didnt specify if you formed the kingdom or the duchy of lithuania
You've all doomed Constantinople to an Iconoclast fate. Muahahahahah!
EDIT
To make it totally clear, give dutchy titles to people who hold county titles, not towns and such, correct (to avoid the Republic blitz)?
yes thats correct
the person you're giving the title to should have a castle as his primary holding type (barons/counts/dukes etc) and not a city (mayors/grand mayors etc) unless you want to create republics. republics can be interesting to have later in the game when they have enough tech to build trade posts everywhere and make a lot of money but they'll also dislike you because you're not a republic yourself
just money. they're city vassals so they'll pay you depending on your city tax laws. thats their only use though. just remember you'll have a permanent opinion penalty for being a fuedal lord as their liege so they might join a lot of factions
The money won't be quite as good on the Baltic as it is on the Black Sea. If you can, do both. The best vassal merchant republics are small (2-3 county duchies) and all coastal. Up north, Estonia or Courland would make good mechant republic. Down south, the duchy of Cherson or Crimea will be a great money machine.