Esteep,
Q1) Starter Solenoid - ECCS ecu accepts signal to indicate when the engine is being cranked to life by the starter motor; think of this signal as invoking a software routine that issues extra fuel for cranking. Without this signal, the motor will be very stubborn to start. In the case of a basic wiring install, the signal for this pin would come from the pushbutton providing +12V to the starter tab.
Q2) toggle switch to "key on/Switched 12v" is fine --> +12V will power everything, [no]V will turn everything off