docs: comprehensive repository polish + step-by-step user guide

Documentation Rewrites:
- AI_INIT.md: fix duplicate section numbers, add file responsibility map,
  fix stale manual mirror instruction, add room ID constraint
- PRIVACY.md: add TL;DR statement, data retention table, explicit
  <all_urls> justification, self-hosted instance disclaimer
- CONTRIBUTING.md: add local testing guide, version warning, room ID
  constraint, bug report requirements
- shared/README.md: complete event table (all 15 events), fix stale
  manifest.json reference
- docs/SYNC_GUIDE.md: Chrome→Browser, add README.md to sync list,
  drop stale RC5 reference
- server/README.md: sync env defaults with .env.example (1000/50)

New Documentation:
- docs/HOW_IT_WORKS.md: 10-step walkthrough covering room creation,
  invitation bridge flow, synchronized playback, force sync protocol,
  heartbeat system, and episode auto-sync. Includes exact data payloads.

Infrastructure Cleanup:
- docker-compose.yml: remove deprecated version key
- .dockerignore: remove dead .bat/.sh patterns
- README.md: add self-hosting extension config tip, link HOW_IT_WORKS

README.md

@@ -67,12 +67,15 @@ docker-compose up -d
 ```
 The server will be available at `ws://localhost:3000`. See [docker-compose.example.yml](docker-compose.example.yml) for advanced configuration.
 
+To connect your extension to a self-hosted server, open the popup → **Room** tab → select **Custom Server** → enter your server's WebSocket URL (e.g., `ws://localhost:3000`).
+
 ---
 
 ### 📖 Documentation & Links
 
 - **[PRIVACY.md](PRIVACY.md)**: Data Handling and Privacy Policy.
 - **[CONTRIBUTING.md](CONTRIBUTING.md)**: How to help make KoalaSync better.
+- **[HOW_IT_WORKS.md](docs/HOW_IT_WORKS.md)**: Step-by-step walkthrough of the complete user flow.
 - **[ARCHITECTURE.md](docs/ARCHITECTURE.md)**: Deep-dive into the two-phase sync and heartbeat logic.
 - **[SECURITY.md](SECURITY.md)**: Disclosure policy and security practices.