What is node & block? Both are different or can we use both terms interchangeably?
No, you can not use them interchangeably, Block is collection of transactions, with a header containing a hash pointer to last Block in a Blockchain. Whereas Node is a software(Implementing Ethereum Protocol Rules) running on a computer. This Node software(Implementing Ethereum Protocol Rules) can be written in many different languages. So, we have Geth Node (Written in Go), Parity Node(Written in Rust) etc.
Can we able to create one node in blockchain? If so, then how we can proceed?
No, Nodes are not created in Blockchain, Only Blocks are created.
As per my assumption, Whenever a new transaction has created, it will spread all over the blockchain nodes. here what term should be used either node or block? (transaction spreading through block or node)
Yes, transaction will spread to whole Ethereum network(Ethereum uses DevP2P, which is a general protocol of discovery and connection of Nodes), and subsequently some miner who has included it into a new Block, gets mined ( the Block containing the transaction will get included in Blockchain ). Information that certain Block has been mined will again spread over Ethereum Network.
how does the nonce bit is defined? When I went through some links I found that it is defined after the mining has done. There are certain problems which are solved by miners and one block is generated. Is my assumption correct? If so, As per this case, If the new transaction has inserted in the block then the nonce bit updated or not?
Mining(Proof of Work) is a process where every one is solving a puzzle to compute a Block hash that is less than a Target number (for ex. first 65 bits should be zero in one 256 bit number). Whosoever solves this first, broadcasts the Block with computed Block hash to nodes all over the network, which is verified by nodes according to Protocol rules. if found everything is according to protocol rules, nodes accepts it,miner gets a reward in Ethers and everyone starts working on new Block in Blockchain.
Nonce is a special field in Block header that facilitates in computing Block hash,See how it helps: A miner picks transactions from transaction pool and build a Block header and Block hash according to protocol rules. Now as stated above, this Block hash has to be lesser than a Target Number, if this is not, miner start increasing Nonce value till they find a match.
How the new transaction inserted all over the blockchain nodes or blocks?
How does block difficulty define?
Ethereum protocol defines a time interval of 12 seconds between Blocks, so approx every 12 seconds a new Block is found.This is made possible through a number which is called Block Difficulty. According to Ethereum protocol,if last blocks have been mined in less than 12 seconds,it adjusts Block Difficulty so that new blocks be mined in 12 seconds.(Means make it harder for nodes to find Block hash) and vice-versa.
I have tried to answer above questions in more generalised sense, if you want specifics you can download and read Ethereum yellow paper