*1* Well, there has to be indexing of some sort for the site search to work with, someone has to crawl your pages so who better than the SE's who have (or will) crawled your site anyway.
You can get Google or other 'search boxes' and set them to only search your domain and return results for your domain. This is the best solution.
If you want a completely in-house search function, then you probably need to hire a programmer.
See here for some suggestions

*2* You can setup user FTP logins via your hosting service. If you have a cpanel account, you can do this from there.