Hard board is slick enough to provide a good out feed table, and it's a good work surface.

What is the best material for table saw top?

MDF is better to work with if you need to rout a groove for a protractor or any edge routing. The edges are structurally better for this, as the slots for a protractor will be nice and clean. Ply may splinter when routing it. MDF was my preference anyway, but that certainly makes the decision much easier.

How much lower should outfeed table be?

Depending on where I roll the table saw and outfeed table the difference in heights place the outfeed table 1/8 inch below to 1/8 inch above the table saw.