For your first question. In Friends ,hold down (note hold, not tap)on the contact to bring up block/hide,/chat etc.
Hide the contact.
Then go to, Settings, Friends, manage friends, hidden users, edit, remove.
Second question eliminating unwanted chat.
In the actual chat, there should be an arrow in the top right hand corner. Click the arrow.
Then there should be a drop down box that says "chat settings" amongst other things. Click chat settings..
This should lead to a drop down box that says (again amongst other things) "delete chat history."
Click delete chat history and the whole chat is gone, preserving the contact.
If photos are exchanged in LINE and the recipient doesn't save them,they will expire after a certain amount of time. Although they may still remain visible on the chat screen.
To prevent them expiring,as soon as you receive a photo you should do the following.
Tap on the photo (note tap and not holding down)
This will bring a full screen of the photo with a little 9 block square in the top Right hand corner.
Tap the 9 block square. This brings up all the photos you have received in that particular chat.
Now in the bottom right hand corner you should be seeing "select". Tap that.
Tapping "select" should change the bottom of the screen to show "Album" on the left side, and "Device" on the right side. It should also bring up ticks on each individual photo.
Tap the ticks to select each individual photo that you want to keep,then tap "Device" to save them to your phone.
This keeps the photos and prevents them from disappearing.