\\A) Whether we can include all the non free content on CD?\\
For non-free images we need to meet few criteria. See this for details
https://en.wikipedia.org/wiki/Wikipedia:Non-free_content#Images
But I found some of the images currently tagged as non-free in Telugu wikipedia will not fall under fair use license. For example
this image. As mentioned in the above blog post it is better to include only Free-Licensed images in the CD. See the section "
STEP 3 – Verifying the license of the images" in the above blog post. To be on the safer it is better to include only free images from Commons in the CD.
\\B) Whether WMF/WMIN will approve the use of Wikipedia Logo on the cover?\\
Yes. Ask WMF/WMIN. For the recent release of the second edition of the Malayalam wikisource CD also Malayalam community took permission from WMF to use logos. It is advised to get permission before using the logos in the CD.