GRB 050904 at redshift z=6.29, discovered and observed by Swift and with spectroscopic redshift from the Subaru telescope, is the first gamma-ray burst to be identified from beyond the epoch of reionization. Since the progenitors of long gamma-ray bursts have been identified as massive stars, this event offers a unique opportunity to investigate star formation environments at this epoch. Apart from its record redshift, the burst is remarkable in two respects: first, it exhibits fast-evolving X-ray and optical flares that peak simultaneously at t~470 s in the observer frame, and may thus originate in the same emission region; and second, its afterglow exhibits an accelerated decay in the near-infrared (NIR) from t~10^4 s to t~3 10^4 s after the burst, coincident with repeated and energetic X-ray flaring activity. We make a complete analysis of available X-ray, NIR, and radio observations, utilizing afterglow models that incorporate a range of physical effects not previously considered for this or any other GRB afterglow, and quantifying our model uncertainties in detail via Markov Chain Monte Carlo analysis. In the process, we explore the possibility that the early optical and X-ray flare is due to synchrotron and inverse Compton emission from the reverse shock regions of the outflow. We suggest that the period of accelerated decay in the NIR may be due to suppression of synchrotron radiation by inverse Compton interaction of X-ray flare photons with electrons in the forward shock; a subsequent interval of slow decay would then be due to a progressive decline in this suppression. The range of acceptable models demonstrates that the kinetic energy and circumburst density of GRB 050904 are well above the typical values found for low-redshift GRBs.