- Technically the SSP is a site collection. It should be setup on its own web application, but it is not a requirement and in fact a Basic MOSS install will put it on an existing web application.
- The SSP provides certain services like Indexing, Profile Management, BDC, Excel Services
- I either do not understand what you mean by #3, or you are incorrect. End users do not use the SSP, it is primarily for administration and configuration of the services referenced in #2. For search there is separation between the indexing and the serving of the query results. You want to configure the site to point to a search center either on a central site, or on the given publishing site. You can configure additional search scopes for the given site collection and then configure those scopes with tabs and or custom results in the local search center.
I like to think of the SSP as a container helping to unify services for a collection of Web Applications and the site collections theythe applications host. I think it was a great idea, but it had some limitations and problems so the whole model has changed in 2010 and there is no SSP.