Re: picking hand/arm position problem while alternate picking
I don't think there is one 'right' way to pick, otherwise every shredder would pick exactly the same. You need to work out how you pick the best, be it with the wrist, with the thumb or with more of the arm and with what hand position. For example Paul Gilbert is fairly unusual in that he picks with a 'floating' hand - (i.e. unanchored) and entirely from the wrist, but then you have guys like Petrucci who rest their pinky below the strings and use a bit of elbow as well as wrist. Totally different approaches, but both had successful results.
To work out what works for you, just play one note on one string and pick as fast as you possibly can, then take this exact movement, slow it right down and stick with it. Use the same motion for crossing strings, but do it slow, then over time you will be able to build on it until you reach your absolute maximum - the same speed you could pick that single note. That's the key - having the same motion for playing slow as you do fast, it doesn't really matter what that motion is as long as it works for you.