It's "code" for Particleboard.

Yes

Get a "power planer"

Yes it is.

MDF uses a finer particle than particleboard. The result is a board that machines better ( more evenly) and has a nicer finish surface whereas particle board is used more in underlayment situations where the board will be hidden.

The price would depend on the amount of work, grade of particleboard, any preparation or finishing work required, and the difficulty of accessing the work area. The material costs will be about $19 for a sheet (3/4" x 4' x 8'). The costs to put in underlayment for a floor will be a whole lot different than (for example) installing it in an attic ceiling.

A word to the wise: Never ever ever install particleboard where it may become wet, or will be continuously exposed to high humidity.