Set up:
Roma: 2 Western Roman Foederati (not Legion) and one city

Rules:
10.6.1. 2nd paragraph: "You cannot rebuild a city that was pillaged in the same nation game turn."

Is 5 Roman Legion in Pavia correct?
Yes. Do not regard stacking limit during set up. But the Roman player has to observe stacking limit during his turn.

May a unit retreat in empty areas?
Yes, but the defender my not retreat in areas the attack came from.

Victory Points for Visigoths/Huns
Huns and Visigoths get victory points for units in Alpes (Visigoths) or Noricum (Huns). To get these points, the player has to remove the unit from the game - the unit moves away from Italia and never comes back.