The plug needs to be held in a two piece tapered holder (tapered hole and a base clamped) with the working end exposed. Drilling at a speed you make a continuous chip will work or a two flute endmill will let you make the blind hole flat.
Location should be ergonomic to you while:
Reversing while tapping
Bumping the motor while inspecting/ aligning the part in the chuck
Clear of the spindle in case stringy chips are wrapped around the chuck/ part
The main contributing factor with using a cold saw and the specific material you plan to use it for is the number of teeth (TPI like a band saw blade).
My experience has always been to reach out to the blade grinder (same place I purchased my saw from). Let them know exactly what...
I would suggest a Lincoln wire feeder (1-3 lb spool capacity). Under a grand and sufficient for small tasks.
Using an inner sheild wire is fine. You may want to get into solid wire and shielding gas down the road but it will be an added expense.
A habit I have is to go thru as much of the equipment until I'm confident it's where it needs to be reliable.
Changing the cords will add a level of safety and confidence in the tool.
Keep in mind, not everybody's standards are up to yours or mine.