How does Boo come to be shut in his house? Who is the primary source of information about Boo for the children?

Neighborhood rumor and legens is where most of the children's information comes from.

According to neighborhood legend, when the younger Radley boy was in his teens he became acquainted with some of the Cunninghams from Old Sarum, an enormous and confusing tribe domiciled in the northern part of the county, and they formed the nearest thing to a gang ever seen in Maycomb. They did little, but enough to be discussed by the town and publicly warned from three pulpits: they hung around the barbershop; they rode the bus to Abbottsville on Sundays and went to the picture show; they attended dances at the county's riverside gambling hell, the Dew-Drop Inn & Fishing Camp; they experimented with stumphole whiskey. Nobody in Maycomb had nerve enough to tell Mr. Radley that his boy was in with the wrong crowd. One night, in an excessive spurt of high spirits, the boys backed around the square in a borrowed flivver, resisted arrest by Maycomb's ancient beadle, Mr. Conner, and locked him in the courthouse outhouse. The town decided something had to be done; Mr. Conner said he knew who each and every one of them was, and he was bound and determined they wouldn't get away with it, so the boys came before the probate judge on charges of disorderly conduct, disturbing the peace, assault and battery, and using abusive and profane language in the presence and hearing of a female. The judge asked Mr. Conner why he included the last charge; Mr. Conner said they cussed so loud he was sure every lady in Maycomb heard them. The judge decided to send the boys to the state industrial school, where boys were sometimes sent for no other reason than to provide them with food and decent shelter: it was no prison and it was no disgrace. Mr. Radley thought it was. If the judge released Arthur, Mr. Radley would see to it that Arthur gave no further trouble. Knowing that Mr. Radley's word was his bond, the judge was glad to do so.