Yup, floss is DMC (or other brands...but DMC is the most widely available) embroidery floss...like for friendship bracelets.
You can use lots of different things for hair...wool, embroidery floss, pearle cotton, yarn, mohair, fake flower petals, feathers...anything you can think of
And, yes, their head is a wooden bead. I used to like 12mm beads but I've changed my mind and now I like 14mm beads.