Mary it's okay to be scared and it's totally normal. I personally am terrified. But in my book, fear is just excitement judged by a moment of pessimism. With the next breath, fear become anticipation and from anticipation sheer joy. And that's what we're all here about, the joy of children.
Your concerns are normal and healthy. The homestudy is a very scary even until you go through it. After it's done you wonder why you worried so much. There are some people who have had bad experiences...but they are few and far between. The SW main goal is to help children by helping you find a child. They WANT YOU TO BE A GOOD FAMILY!!. They won't lie or make things up, but they will usually look for the good in you rather than the bad. It's counter productive to their aims to do otherwise.
As for fretting over the paperwork...I have a terminal degree (you mentioned your master's thesis) and the degree paperwork was far harder and far more stressful (though nowhere near as important) than the dossier materials. If you've done a thesis, this will be like cake!
I did all my paperwork myself and it wasn't bad at all. Your agency will let you know everything you need and none of it is difficult...just a lot of steps to verify the verifications of the authentication of the certifications. It's not a lot of documents really, just a lot of steps to make sure everyone agrees all the paperwork is legitamate.
As for the bedroom situation, they don't want to see anything finished, they just want a plan. A 3 bedroom house is plenty of room for a four person family.
It'll be fine. It's a very exciting and very rewarding process. I actually miss the paperwork...it was easier than waiting. At least then I felt attached. I hope to receive referral in Aug. so that's when we go into high gear again. So please if you have questions ask on the forum or PM...these message boards are a lifesaver and are far less expensive than therapy while you wait for your baby!!
Congratulations on your decision!