Magic Bow Shooting a Magic Arrow

I believe I have this figured out, but it still comes up for debate in my games.

If a player has a +2 Caustic Longbow and shoots a +1 Flaming arrow, the result is +2 Caustic and Flaming attack (1d8+2+1d6 acid+1d6 fire), correct?

I would say yes, but im no authorty.

If a player has a +2 Caustic Longbow and shoots a +1 Flaming arrow, the result is +2 Caustic and Flaming attack (1d8+2+1d6 acid+1d6 fire), correct?

Yep.

Ranged Weapons and Ammunition: "The enhancement bonus from a ranged weapon does not stack with the enhancement bonus from ammunition. Only the higher of the two enhancement bonuses applies.

Ammunition fired from a projectile weapon with an enhancement bonus of +1 or higher is treated as a magic weapon for the purpose of overcoming damage reduction. Similarly, ammunition fired from a projectile weapon with an alignment gains the alignment of that projectile weapon."

Yes, mostly it is the requirement that ammunition follow the same rules for enhancing as a regular weapon that creates the confusion...(though from a merchant you can by far less than 50 if you DM allows, thus mitigating the upfront cost).

Unfortunately there isn't an easy way balance wise to remove the confusion as, if they didn't keep the requirement, you would see people running around with some very cheap enchantments :-/ (Ie paying 2k for 50 flame arrows instead of 8000 for 50 +1 flame arrows).

The only time this gets really interesting is if the bow/arrow combination would put you over the +10 limit for using a weapon. Deciding which things won't work has no rules. You just have to work it out.