It sounds like you may have read this before, but I must emphasize: iCloud Photos isn't a separate storage device like an extra hard drive. You can't keep pictures at iCloud instead of on your iPad.
iCloud Photos is a synchronization service. When you engage iCloud Photos on a device, then the Library on that device is kept exactly the same as the iCloud Photos Library. So, for instance, if you take a picture with your iPad, it is added to the iPad's Photos Library, copied to iCloud Photos Library at iCloud.com, and then copied to the Photos Library on each of the other devices that you have connected. If you delete a picture on your Mac, then that picture is deleted at iCloud and on all the other devices.
So, question 1) If you turn off iCloud on your iPad, delete pictures from the iPad, and reconnect to iCloud, then Photos will again make the Libraries have exactly the same pictures. It will copy all the iPad's pictures to iCloud, and then copy all iCloud's pictures to the iPad, always doing its best to avoid duplicates.
So you can't think of iCloud Photos as a backup service, since it backs up mistakes, and there's no way to undo them. Whatever you do with Photos on your device-- it happens everywhere else. And you can't think of iCloud Photos as an extra hard drive, because iCloud Photos at iCloud.com always has exactly the same pictures as your iPad.
You can use Optimize Storage on a Mac, on your iPhone, or on your iPad. If you set a device to "Optimize Storage,"on your iPad, then Photos may store only smaller images on the it and rely on iCloud to keep the full sized images. This is great, since with the lower resolution images you can scan through pictures very quickly, and they look great on the screen. So, if Optimize is chosen, and you want to edit a picture, Photos will reach out to iCloud to get a full sized image for you to work on. It's the same for printing or anything that demands the full picture. Your optimized Library may take up less than 20% of the space of a fully downloaded Library. But an optimized Library may be kept larger than that if the extra storage space is not needed.
question 2) iCloud offers an iPad backup, but it doesn't include pictures if you are also using iCloud Photos--they don't want to store the pictures twice. If you don't use Optimize Storage, then you can plug an external drive into the iPad and save all the pictures using the Files app. If you do use Optimize Storage, it is probably better to download all new pictures directly from iCloud using a browser on a computer, since the iPad doesn't keep the full originals.
However-- do you have a Mac? If so, then the Mac will have the same pictures and, if you don't use "Optimize" on the Mac, then it will have the full sized pictures. Then the best thing to do for a backup is to use Time Machine to automatically make incremental backups of the Mac to an external drive. And, in addition, you should drag a copy of your Photos Library from the Mac's Pictures folder to another external Library. The Library has lots more information than what is available in picture files, so copying the Photos Library is the best thing for backups.
I use "Optimize Storage" on my iPhone, but not on my Mac, because I want to use my Mac to backup the pictures.
