1 - I used a LaCie Rugged external SSD but that was 4.5 years ago - still working fine. Other external SSDs that I have used include Samsung T5 and SanDisk Extreme Pro. All work fine.
2 - This is what did, but you can format as APFS: https://duckduckgo.com/?q=install+mac+os+catalina+on+external+ssd&t=osx&pn=1&iax=videos&iai=https%3A%2F%2Fwww.youtube.com%2Fwatch%3Fv%3DkdzK5lgqLjM&ia=videos
The external SSD that I use is 250GB. The iMac’s internal HD is 1 TB. After I made sure that the external SSD worked well as a startup drive, I reformatted the iMac’s internal HD to be used for storage. I described what I did in this thread: OS on external SSD, leave data on spinning drive?
Before doing anything make sure you have good backups of everything.
Also, I’m sure others will have suggestions as to a good external SDD.