Can I use the empty paper towel roll for the finger pieces?

You can, it just won't be as flexible when you fold it. I'd recommend not adding stems, as that will put more weight on your flowers.

The compass needs to go in the very middle, and the paper has to surround it.

Yes. It will last far longer then cardboard..

It's just to make it look more like a guitar. It also may make it easier to hold on to.

Yes, you can use any paper that is easy to handle (printer paper, construction paper, etc.). But make sure that the paper is a square and has equal sides (unless...