The blue is the good/filtered water. And yes, yellow is the intake. Red - waste.
Visit the local hardware store and talk to the plumbing folks. They'll get you a brass, garden hose type, compression fitting that will connect to the yellow (very small plastic) line.
Not sure about reservoir placement and how to maximize your stuff, but the float valve may be used in a number of ways IMO
. In the tank sump for auto top-off from a FW
reservoir, in the collection tub (I use 44g trash cans on wheels) to keep that water from overflowing, or in the waste tub (if you were collecting it for washine machine use, etc - wife wouldn't let me throw it away), or as I think I've seen - never had, as a shut off for the water supply to turn everything off when a container is filled.