1. Your fuel gauge should still work. I think you probably cut out our stock fuel switch...you need to keep that installed, just splice into the two wires to run the pollack. (That's how I did mine, you might need to use the other wires coming into the pollack to make that work, but I'm not sure.....the way I did it works, anyways)
2. Here's a crude drawing to try to show how I did it. Blue is supply, Red is return. If you've got questions, post up...
At the tank, I took off the stock hose and ran new stuff all the way to the tank connections. I had to do that because my hose ran on the other side of the truck. If I could, I would use as much of the stock line as you can.