If I create albums and put pictures from my photo stream in them, will they get deleted automatically after an amount of time or will they forever stay in the album?
Because you saved a second copy on your phone. The device saw it as a new photo and put it back in your "My Photo Stream". Also Albums on the iPhone are not "folders" but really "Labels". Every photo will still be in "camera roll" regardless of what "Album" they are in. I hope that answered your question, if not could you be more specific to where the duplicates are occurring.