IAM users are users of the Amazon API/CLI/UI, not OS users. You can create an IAM user that can create EC2 instances, and on those instances there will be a default OS user that you can log in with using an SSH key you can provide. For Amazon Linux images the user will be called 'ec2-user', for other distributions it will be e.g. 'ubuntu' or 'centos', and they will have sudo privileges.
For all of the things you ask you need to be able to login on the instance itself via SSH. So you need to either share the default user's SSH key with that person, or you need to create a second user on the machine itself.