Hmmm... best to see the problem. Generally you grease the bearings if they are loose or caged (actually always)... headset adjustment is moderately tricky, but not hard once you figure it out. Threaded, you usually need two wrenches, one for the topnut, one for the locknut... The old school trick is to use your brake (if you got one, that is)... if you hear a click from the headset area when holding down the front brake, the HS needs tightening; if when you hold the bike up the wheel does not flop easily slide to side, you're too tight. There's a bit of a fine medium.

If you want me to look at it, I can, assuming you're in RVA. Or you can take it by Re-cycles on Cary, they will likely help you out... they seem to be pretty good about helping folks out. In fact, ask 'em, if you're in RVA, I'm guessing that's where the class was...

"Stem" generally refers to the part that inserts into the steerer tube, and holds the bars on the other end.