I'll step up and take a shot, but I don't understand the questions very well.
1) localsystem is an NT pseudo-login, it is not a SQL user. I would recommend using localsystem as the NT login for the SQL Server service unless I had a specific reason to use some other login.
2) No, do not specify a port number. SQL Server will handle this on its own for new installations. Unless you are doing something very specific and know that you need another port, then you should just use the default.