Maybe I'm being a bit dumb here, so please forgive. The account approval process - is that something I have to apply for or do my clients ? If it's something I have to do then how do I approach that when I don't have a list myself yet (well, not one greater than ~ 50 people) - do I need to ask questions of my clients when they first sign up? And if so, what questions? Also I see in the 'How does the approval process work? page it hints that approval is only required for lists greater than 500. Is this assumption on my part correct?
First, you always want to make sure that you're talking with your clients about permissions. Make sure they're well aware of the permissions policies and that you're aware of where their subscribers are coming from, to make sure everything is kosher and they're obeying the rules. You are responsible for your clients.
Second, the way the approval process works is the first time you're sending a campaign (for a client) that's above the initial approval limit (so around 500 recipients) the moment you define the recipients of the campaign a big box will pop up asking you to answer a couple of questions and submit the campaign for review. You want to make sure you give a complete explanation as to how everyone explicitly opted into your client's list and also make sure you're submitting a completed campaign for us to review. Then, within 12 hours we'll get back to you either with an approval or let you know if we have any more questions.
The process is the same if your clients are sending a campaign, just with a couple differences. They'll be the ones answering the questions rather than you and the review still comes to us but we'll communicate with you if we need any further information, we never ever contact your clients directly.
The approval process is tiered, so for most clients it's just a one time thing, once they're approved they never need to worry about it again unless their list grows significantly and hits the next approval limit. If the client themselves went through the approval process (rather than you sending the campaign yourself and being approved) you'll be able to see their limit under the client settings tab.
Hope that helps!