So many issues

[Photolicious]

I am the very happy owner of a brand new Canon 450D (Digital Rebel something in the US with a standard 18-55 mm kit lens and I also own a nifty fifty, which I really love.
I only have the pop-up flash but I always use a Light Scoop to throw the flash into the ceiling and back down again. (I never take it off

I have a few kids, that I love to photograph, and when I do a mini-studio set up in door, I am able to get quite nice shots with crisp and fresh colors and they are quite SHARP.

Now, when I go outside, something bad happens. The colors look muddy, the skin is blotchy, and nothing is sharp. I have tried different setting, but I am not sure how to get that crips vibrant look like it is coming out of a magazine - is it even possible?

Another question:
Sometimes I want to photograph more people in one shot, not that uncommon Where do I point my focus point to get everyone sharp? I have ;experiemented with having just one focus point, and all of them and the latter doesn'y give me good results, and the former only makes like ONE eye on ONE person sharp, while the rest remain a tad unsharp.
How do you focus on multiple eyes at the same time, while maintaining a shallow DOP?
(This Q also goes for just photographing one - how do I get both eyes to focus?

I inserted a link to two photos on Flickr which illustrate my focus/color problems. Note, that these are just snapshots,and not meant to be artistic.

IMG_2718small on Flickr - Photo Sharing!
Thanks

[OsmosisStudios]

Looks pretty good to me. A tiny bit soft, but not that bad. It could be because you're shooting at 55mm and f5.6, which is the weakest point on the lens.

[candleman]

looks fine to me

for groups you need to stop down on the aperture to increase your depth of field.
so betweem f/5.6 and f/8 you should be fine..
Aperture Priority mode is easiest for this.

[Photolicious]

If you zoom in you can tell that they are not crisp unfortunately.

I have seen group portraits where the eyes were in focus (all of them), but the rest of their faces and background still had the small dof - how can this be achieved? Is it even possible for a normal person like me...LOL?

[OsmosisStudios]

DoF is a factor of the subjects distance from the background. Even at f/8, if your background is far away, you'll have it blurred out.

I looked at the largest size you allowed on Flickr, but I still couldn't see much issue.

[Elite Shutterbug]

i agree it looks fine to me, but for group shots go for like f 7-8 it will give enough dof. but if u want the background and other things out of focus you will have to bring them farther away from the background or do some retouching in Photo shop or something to get that done. not EVERYTHING can or will be done on camera. digital darkroom magic may still be needed to make it perfect.