you should get queryResult.docCount = all the documents but actual number of documents returned would be HITS only for each page.
use offset to display different pages. Each page would have HIT number of documents.

Let me know if you need specific code and I should be able to help you.

You are right.
HIT means number of documents to be displayed on each page.
So whatever number of documents you have, each page would have only HIT number of docs.

Try only pulling HITS documents from the iterator and then stop.
Have a look in esp/var/log/querylogs/ and check the latest query log file. In there you will see what "hits" parameter was sent from your API. It should be 2.

Then try to run your code further, iterating over the whole result set. You will see that the API translates this into multiple queries, each with hits=2.

It's not a problem, it's a "feature".

My experience is with the Java SearchAPI only -- I've no idea how the .NET one works.

When you create and execute a query object for 10 results, you'll get a result object with all the information you need to present those 10 results to a user. If you invoke the iterator, you can iterate over those 10, BUT when you get to the end, the API will go back to the FAST QR server and fetch the next 10 hits. So the iterator will continue to move through the next set of 10. This will continue until you've iterated over ALL the results that FAST can find -- i.e. it does NOT stop at the 10 you originally requested.

A typical approach is to use an old fashioned FOR loop with a counter that will stop at 10. Use that to build a real List of results, than use that List at the presentation layer, or wherever you need to use it.