You shouldn’t stop OH for this and use other tools. You can put the ZWave stick into inclusion mode from within either PaperUI (the blue + under Things) or habmin (click the circled +).
The lock to work properly requires SECURITY implementation which is not supported in the current code. There is a not-yet-officially-released version of the ZWave available, see this thread.
Not sure what you’re trying to control in PaperUI because it’s not intended to be used to control (use) devices. It’s just for administration purposes. Set up a sitemap and use BasicUI instead.
On the 500 error, well this is difficult to tell from the outside. You possibly entered invalid parameters, but in fact this could be anything. You would need to enable proper logging (at least log:set debug org.openhab.binding.zwave in Karaf console) und check the logs for hints, but there’s many possible reasons for this so noone will be able to give you a checklist here.
Have you gone through the basic tutorials on docs.openhab.org ? Jumping right into the middle often results in making settings without understanding what they’re for, and it’s close to impossible to quickly explain to a beginner how to systematically debug the whole thing.