Read the entire thread - till Paro. It seems to be a nightmare to get it done yourself. I'll rather catch an agent to do the fight for me.
No. 5 in my questionnaire still remains unanswered though. Oh yes, I called up the Bhutan Embassy at Delhi today. The person on the other side of the phone was polite enough to answer my queries, and he said he hasn't heard any such sort of restrictions for solo travelers. He mentioned that the process is same for all - solo or group. But he provided me couple of numbers of the Embassy at Phuentsholing, mentioning that they could answer it better.
I'll call them tomorrow.
I think its more a function of when you travel, we traveled in peak season when most people (Indians are the only ones permitted by road) cross the border by road as schools are shut. End October may not pose such a problem as Diwali this year is 17th Oct and all schools will have reopened by then.
To answer your question on solo traveler I had met another biker who was solo and he said that they are a bit more critical of solo traveler. In order to circumvent any issues he had carried with him additionally over the required paperwork
- His complete itinerary in Bhutan (Thimpu & Paro Only) with hard copies of hotel reservations to substantiate his claims.
Of course now it is mandatory for all travelers to show booking confirmations as per the itinerary.
Regarding insurance you can just get an geographical extension for Bhutan on your existing policy for a nominal amount. gets done in a day
BTW there are no online links for the permit will have to do it in Phuentsholing
Hope this helps...