foam underlay

Some info: I've got 10mm laminate, going onto 5mm foam gold foil backed underlay with a chipboard subfloor. Questions: 1. Do you need to run the underlay up the wall a few inches instead of just flush to the wall edges, then cut it away at the end? Why is this? Seems a faff with the spacers...

We are tiling our bathroom floor which has 70 year old floorboards exhibiting the usual wear, tear and irregularities. There is also a slight bow to the floor, albeit only noticeable with a long, straight edge. Replacing them with chipboard is not really viable because two of the original walls...