Hi Siddu,
Welcome to using TestStand! You don't have to create a userInterface in CVI. We have created two user Operator Interfaces, one relatively simpler than the other, in CVI that are shipped along with TestStand. They can be found at \OperatorInterfaces\NI. The full featured interface has a lot of functionality than the simple interface. However both these interfaces are completely customizable.
To answer the second question, to distribute your application, you can use the TestStand Deployment Utility. The utility can be found within TestStand, under the tools menu >> Deploy TestStand System. The wizard should walk you through the entire process. You can find more information in the TestStand Reference Manual, Chapter 14.
Also, you would need a TestStand Run-Time License for every computer that you would distribute your application on.
Hope this helps.
SijinK
National Instruments