The fpz file connectors have no relation to the physical connectors. The female connectors are used for the breadboard as a place to make a connection (without showing up in schematic), male connectors (which you normally want in a part) accept wire connections and appear in schematic. On the pcb (should you make one) you would actually use male headers (one side soldered to the board, and the other side plugs in to the connectors on the chip), but from the pcb point of view there are only the holes that you can choose to put male or female connectors (or wires) in to.
It certainly does 
as it stands it is the start of the work that needs to be done to make a better schematic. You (or someone) needs to move the rest of the pins and terminal to the correct positions and add the rest of the pin labels, I just did the first few to show how I would do it (there are lots of other ways to do it as well that are equally good). You may want to increase the font size on the labels for instance to make them bigger and thus easier to read. You do however want the pins (and the terminals) to be on a .1 inch grid to match both the grid and most other parts. If you can't figure out what I did, ask and I'll try and explain better.
Peter