Here "city" refers to the people. The city is spoken of as if it were a container. And, "confusion" is spoken of as if it were the contents that filled the container. Alternate translation: "Then people all over the city became upset and started shouting" (See: [[rc://en/ta/man/jit/figs-metonymy]] and [[rc://en/ta/man/jit/figs-metaphor]])
The Ephesus theater was used for public meetings and for entertainment such as plays and music. It was an outdoor semi-circular area with bench seats that could hold thousands of people.
These are names of men. Gaius and Aristarchus came from Macedonia but were working with Paul in Ephesus at this time. (See: [[rc://en/ta/man/jit/translate-names]])