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Correct! In the new system, the normal force is along +y, as the new y-axis is also perpendicular to the inclined plane.

The +x direction is upwards along the inclined plane. Remember that friction is in a direction opposite to that in which the block would move. As the block moves downwards, friction is along +x.

Weight is acting downwards, yes, but, it is not exactly along the x- or the y-axis. It is at an angle to both of them.