Man was created in God's image, and so everyone has a free will, just as God has a free will.1) Why is it that one unregenerate person believes the gospel and not another?
One unregenerate person chooses to sumit to Christ, and another doesn't.
The principle of free will.2) What principle in him made him choose what he did?
3) Was he able to generate a right thought, produce a right affection, create right belief, while at the same time man #2 did not have the natural wherewithal to come up with the faith to be saved?
He was able to choose. Both person #1 and person #2 were able to choose. The first chose to submit to Christ, but the second didn't.
Neither "made use of grace" in order to submit. Once having been regenerated, the grace of God becomes available to enable the regenerated person to obey God and work righteousness. See Titus, chapter 2.4) If they both made use of the same grace, did one make better use of it than the other?
5) If prevenient grace places us in a neutral state, then what motivates one man to believe and not another?
The "motivation" is the proclaiming of the gospel, the love shown by disciples, and the urging of the proclaimer. But even so, some people choose to respond, and others don't. It's the free will of man. It can't be anything else. But if you were to use a stronger word such as "cause" (What is the cause of a person's choice?) then I would say, there is no prior cause. The choice of a free will agent is a sort of "first cause" in a string of causes and effects.
"Whosoever will may come and take of the water of life freely"
No. Not by chance, but by choice.6) If all men are neutral in prevenient grace was it by chance that one believed and not another?
7) Is it the grace of God that makes you differ from unbelievers or is it your faith?
It is what you ARE! It is by faith that you are able to appropriate the enabling grace of God--- made available by Christ's death and resurrection. We must co-operate with the grace of God, or it will be in vain, accomplishing nothing.