This is the best way to learn to code. I would recommend learning to code before getting frustrated at an install and quitting.
I disagree. I think it is better to directly use the official installer for Apache and the official zip archive for PHP, then follow the instructions given by the PHP manual, which will be your most valued PHP reference from now on.
As you can tell from your other thread, third party installers like XAMPP that install the components for you are not cure-alls for installation woes.
Do I just use notepad and save it with a .php extension?
Yes. Be careful not to save it as php.txt, but as .php.
If so, which directory do I save it to so I can then go back to 127.0.... to see my output?
NogDog helped you with this in your other thread[url].