custom menu for level 1

For your first question, I’d recommend using the Nav Menu Roles plugin, which will automatically recognize the s2member user roles and allow you to do exactly what you want.

On question 2, you can use one Pro license for an unlimited number of sites, so long as you are not creating what they call a “blog farm” (i.e. something like WordPress.com).

> I would like to know if it’s possible to set up a custom menu (either on top or on the right sidebar) for level 1 members (who have paid subscription)?

What KTS915 said. There’s also the Menu Items Visibility Control plugin.

https://www.ads-software.com/plugins/menu-items-visibility-control/
https://www.ads-software.com/plugins/nav-menu-roles/

> will an s2 member pro licence apply to the sub domain of the main site or will I have to buy another licence?

If it’s an unlimited sites license, you can have all the sites you want with the pro add-on. If you have the single site license, then you can use it in only one live site (development installations are fine, they aren’t counted for the license). So two live installations, one in www and another in a different subdomain, would not be covered by the single site license, you’d need the unlimited sites one.

I hope that helps. ??