When donating to an author, what does "price per item" refer to? The bundle of a specific font (say all of Sans Serif as a whole), or per character in their font?

That's the term used by PayPal and, when it comes to donations, it refers to the amount of donation that you are making.

If you intend to use a font for commercial purposes, get in touch with the font author/designer before making a donation and inquire about getting a license for commercial use of a font.