Thanks for the feed back, and comments on my first post.
The wood pipe is for drainage around the stone walls, I sort of believe that what they want is for the square cedar pipe to be sitting on, and covered over by 2 inch hemlock planks. These wooden pipes will last a very long time underground as long as the air is excluded from the wood.
This is typical historical construction directions, they usually leave out some important details, just taking for granted that you know or are familiar with small details.
Coal tar is very flammable but then again cedar shingles are also, as I mentioned above I believe that the coating was meant to prolong the roofs life, but then we will wait for further comments