My site is www.eby.co.il and I have a sub domain called english.eby.co.il (which is relatively new). I have installed JoomSEF on both but it works only on eby.co.il
In the subdomain it creates non-SEF urls OR url names that end with .html

I have two questions:

1) How can I arrange that the subdomain (english.eby.co.il) will work like eby.co.il (with the same type of SEF urls)?

2) I would prefer to have url names that end with .html (with meaningful names) but when I do it in english.eby.co.il it cannot find the pages!

Is this connected to the fact that I have different versions of Joomla! on the different sites?