There are actually two ways to create a "text" link inside a Flash object. You can just make it a button with the same up/down/over state (i.e., the text), and then specify a rectangle around the text in the hit frame. If you put just the text in the hit frame, then the link only works when you click on the text itself, which is annoying and can be hard to do depending on the font and size of the text.
However, if you are using Flash 5, you can actually create a link in text directly. Press Ctrl+T to get the "Character" window, and insert the URL in the URL field of the selected text, or as you create the new text.
No clue on your second question though.