Hi Jim,
Although we can purchase more than 25 licenses in Office 365 Plan P1, in order to ensure the other licenses besides 25 licenses can be assigned to users, I still suggest you contact sales and billing team.
About how to host your website with your current hosting provider, refer to this link: http://onlinehelp.microsoft.com/en-us/office365-smallbusinesses/hh335298.aspx .
In additional, Office 365 Plan P1 doesn’t need on-premise AD (we can deploy ADFS/Dirsync with Office 365 Plan E), all authentication servers are Office 365 cloud servers.
Thanks,
Jacky Ding