The precise block is known to you but not me. If you said, I live in "the large block of flats", then I would say, "There are many large blocks of flats - which one do you mean?" If you said, "I live in a block of flats", then you are telling me either that I don't need to know which one, or you are going to tell me later which one you mean. "a" is used to introduce the existence of a new (countable) thing to the reader or listener.

I believe that you can use 'a' or 'the,' depending on the context of the situation. If no prior information has been established about the situation, then you would use 'a.' However, if information had been made available previously, which could allow a person to distinguish between different blocks of flats, then you could use 'the.' There are several groups of flats in my area. Some of the groupings are small, while others are large. We live in the large block of flats.

Michael's explanation for articles is perfect. In answer to your last question, it should be 'It confuses me. The verb 'confuse' needs to agree with the third person singular 'it' the same as for 'he' or 'she'. Best wishes Bob