The process for color-matching is essentially the same for European hair as it is for Indian or Chinese hair. With Indian or Chinese hair, the factory blends together slightly different shades of dyed hair to match your own color. With real, virgin, European hair, they select hair from different ponytails (cut directly from the donor's heads) to match your color.
It's always better to dye your own hair to match the hair system. I'd recommend having a professional do it - it's not that expensive - maybe $50.
Forget about using your own hair. The hair would need to be 12" long (minimum) - and yes, I know you probably don't want your hairpiece to be that long, but they can't work with shorter hair lengths. In addition, your natural hair doesn't all grow at the same rate, so about half of your hair is 50% shorter than the overall length of your hair. These shorter hairs are discarded, which means that you may not be able to donate enough hair to make a hairpiece entirely of your own hair.
When hair direction was mentioned, he meant that if the cuticle (outer layer) of the hair is intact, then all of the hairs must aligned with the root ends at the same end knotted with the root ends together. If the direction of some of the hairs are reversed, it will cause tangling.
There are different grades of lace, so different types disappear better than others. The French lace I have is 100% invisible against my own scalp.
In most cases, if knots are really obvious, it's due to one or more of these factors:
1. The factory used more than one hair in each knot, making each knot 2 or 3 times as big as it should be.
2. The hair is very, very dark. This can be largely eliminated by having all of the knots bleached, rather than just the knots at the hairline.
3. The hairs are Chinese, which are up to 50% wider in diameter than Indian hair.
If your natural hair color is #6 or lighter, knots really are not a big issue.