Q203: How does cowering interact with the other steps of fear? i.e. if Imperious Command is used on someone already shaken - what happens? Clearly in round 2 the enemy is frightened, but does he still cower normally in the second round?
A203: You are correct; cowering is the "highest" state of fear in D&D.
Although it is often applied in conjunction with fear effects, cowering is not a state of fear in the same way that shaken/frightened/panicked are, in the sense that applying these effects on their own, no matter how much you stack them, will not change a creature's state to "cowering" if the creature is able to flee. It is a separate condition which is simultaneously applied by Imperious Command, and which is also applied to a panicked creature which is cornered and unable to flee. A panicked creature which is cowering because it is unable to flee is still panicked.
If Imperious Command is used on a creature with an ongoing Shaken condition, the creature becomes frightened and cowering for one round, during which it suffers all penalties of the Frightened and Cowering conditions. (It does not, however, flee, unless it is somehow able to do so without taking an action, because Cowering prevents it from taking action.) On the second round, it is Frightened but not cowering, suffers the penalties of the Frightened condition, and must flee if it is able. It will fight if it is unable to flee in this round, as described under the Frightened condition.