- You will need to update the route table on both ends of the connection to direct traffic over the VPN for appropriate IP ranges. See this doc for more detail: https://docs.aws.amazon.com/vpn/latest/s2svpn/VPNRoutingTypes.html
- You will be given two static IPs for your S2S VPN connection when you create it. You are correct - the AWS side of the connection is referred to as the Virtual Private Gateway (VPGW). However, the VPGW is just a logical construct that represents the VPN's entry point into your VPC. The static IPs for the VPN gateway are not assigned until you create a a S2S VPN Connection. Once you create it, you will have two IPs to provide to your network team, which they can then use to configure their devices. AWS provides automatically generated configuration files for many popular devices (available after creation of the connection).
I'm not as clear on the requirement from your network team for a /29, but you are correct that the smallest subnet CIDR is /28. The network team may need to relax that requirement for this connection.
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