Hello Jason,
Are you saying that when a new user joins then I should select basic plan in the sign up drop down?
# No, in your previous configuration you have set Premium Forever plan in profilebased plugin configuration that's why user is automatically subscribed ( as free) to this plan when they signup on your site. If you don't want to assign any plan on signup then no need to configure this.
If I select Basic here what happens to the joining process which should be standard.
# If you set Basic plan here, when user register at your site he will be automatically subscribed to this plan.
What should the Profile Type to be used value be? Easy Social? or? What difference does this value have?
Profile Type value could be
Jomsocial MultiProfile type/Easysocial Profile Type/JSPT Profile Type/Joomla User group , you can as per your need (the extension you are using.).
You are using Easysocial at your site , if you want to assign the profiletype on the basis of plan subscribed by user, you need to set Profiletype to Easysocial in plugin configuration then create app instances accordingly.
Refer below mentioned document for more information.
https://stackideas.com/docs/payplans/administrators/administration/profile-based-plan
Let me know if you have any query.