how do bond ETF's work better, payment, Because, like

amqata

Looking at AGG bond ETF from an individual's POV. Is each coupon within the ETF distributed as a dividend? It looks like 'dividends' are paid pretty frequently. Because it's a dividend (and not a coupon payment) are these tax differently than owning a bond outright? Is it better (costs, diversification) to invest in ETF's as opposed to individual bonds?