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Long fiber Sphagnum moss will be better suited for this. Hay is also useful. This article will help you to care for a newly seeded lawn: https://www.gardeningknowhow.com/lawn-care/lgen/lawn-seeding-tips.htm

A general rule of thumb is to wait at least until you have mowed the new grass four times before using any standard postemergent broadleaf herbicide. A standard pre-emergent herbicide should not be applied until at least three to four months after seeding the area.
A general rule of thumb is to wait at least until you have mowed the new grass four times before using any standard postemergent broadleaf herbicide. A standard pre-emergent herbicide should not be applied until at least three to four months after seeding the area.

Contact the manufacturer customer service number on the packaging and directly ask them about this product and your application.

It is good if the clippings have time to dry out, or are not overly wet. If they are very wet, or it rains often in your area, then you may want to pull up the clippings and compost them. It all just depends on your environment really.

Grass clippings return valuable nutrients to soil, but they can cause fungal infection if they are too moist, or don't have time to dry out.

These articles will offer more information:

https://www.gardeningknowhow.com/lawn-care/lgen/what-to-do-with-grass-clippings.htm

https://www.gardeningknowhow.com/lawn-care/lgen/lawn-mowing-tips.htm

https://www.gardeningknowhow.com/composting/ingredients/grass-clipping-composting.htm

As soon as you see new growth, this will be a sign that it is rooted and can be mowed. Any time that you see fit is ok now.

This collection of articles will help you in maintaining a lawn: https://www.gardeningknowhow.com/category/lawn-care/lgen

If you want to plant seed now, I wouldn't leave the paper unless it is mostly decomposed. If not, you would need to wait till it breaks down before planting and that could take a few months.