1. You could put initials in with the use of the stitches themselves. For example, in a block that is all knit stitch you could purl the initials. The texture of the stitches will show the initials. You could also use another color of yarn and do two color knitting.
2. Try this: http://www.knitting-and.com/knitting/tips/jogless.htm
3. For written instructions on how to make a tassel, look under finishing here: http://knit.atypically.net/scarves/hogwarts/pattern.shtml
4. Cable knitting isn't difficult as long as you have good instructions on how to do it. I advised a friend to get Idiot's guide to knitting and crocheting or a similiar book to help with various stitches and cast ons. Mary Thomas' Knitting is good too.