"2) Is there an option to click on to add 'cash on pick up' to my payment options or do I have to include it in my item description?"

Yes. If you're using the eBay Selling form, when you list your first item, under the band " Decide how you'd like to be paid", click Add or Remove options.

Tick Pay on Pick Up. Click Save.

Scroll back down the page and you'll see the option to tick Pay on Pick Up which will show as Cash on Pick Up in the payment options when the listing is completed.