How nice to hear from someone who has read my long ago garden article! Now to have a go at your questions. You must realize however, that I am not an expert by any means on Chinese gardens. However, in RL I am somewhat of a flower gardener, so I will attempt to respond based on what I know from reading and experience.

First, the Chinese, as you said, were interested in herbal remedies as well as beauty. Unlike us westerners, I think they instinctively combined both form (beauty) and function into their gardens, and without the separation of the two which often can be seen in so many of our modern garden layouts.

I don't know why or how the chrysanthemum came to be such a prominent Japanese symbol, but it's possible I have something in one of the piles of books around here that might help you in your quest. You've certainly gotten my curiousity up.

Does anyone else have any clues to ancient Chinese chrysanthemum culture?