Well let's take this one by one:
You can input everything into the reciever and then to the TV. Since your TV only has RCA inputs you would never have to change the input on your TV the recieer would handle that. There will only be one wire going from your reciever to your tv (the one label monitor out.) Do you ever plan on using the speakers in your tv?
Asking what type of speaker wire you should use could start a long debate here so I'll keep this short. It seems like you're just starting out so I'd keep this simple. I'd go with 12ga. Some people swear by the wire you can buy at Home Depot. If your keeping the cost down in my opinion it works great. And it's cheap. Ive had my mains wired with the stuff for two years now. I think Monster speaker wire is over rated.
There are many good brands od speaker wire on the market and you could easily spend more on wire than you spent on your entire system.
There are special cables for your sub. If you have to go fifty feet that gonna be expensive. The cable is a beefier shielded Rca coax cable. I'd find another place to put the sub, what's the reason it needs to go 50' away are you going around the room?
I don't use any optical cables I use the digital coax but one of the better Monster Cables should be fine. Or look at Bettercables.com the've got some good stuff.
The cheaper cables are not built as well and I have seen them fall apart.
If you go with only a digital out of the cable box you won't have any sound input to your TV. I personally never use my TV speakers but others do.
Do you have a DVD player or are you planning on getting one?
The hooking up of the wires isn't hard if you take your time and are careful. If you wanted to spend some more money you might think about buying some premade speaker wires with bannana plugs on them it makes the setup easier. But it's not
Once you get everything plugged in you have to setup the reciever. You'll have to set your speaker size in the reciever setup. This sets the crossover points for your reciever. I'd would set all of your speakers to small. This will send all of the deeper bass to the sub.
If you have any more question there's always someone here willing to help, let us know how it goes.