Display the Tag Cloud or the Archive directly in posts and pages, and change their look in the options.
The cloud is enclosed in
<div class="pta-posttags">, and the archive in
<div class="pta-postarchives">,so that you can use CSS for changing the look.
text-transform: lowercase; will give it a calmer look.
Having the archive or cloud fully in your sidebar hurts your search ranking, since you have lots of links on your page. Less (but more relevant) links is better. Putting the archives and cloud on a separate page or post is better, as it allows bots to crawl - and interested readers to see all your content in a nice format. Don't add it repeatedly and redundantly though. Make sure it's useful for your visitors, then it's typically also welcome by google.
Not at the moment. Since there is the WordPress internal TagCloud widget. If it's requested often, I'll add it.