Unless you use very strong incense, or very large amounts you shouldn't have any problems using it in the house. Just make sure you light the charcoal next to an open window or something.
Exactly. I've had only once problem with incense, but just because I'd put too much and my father is an asthmatic ;p But fortunately, opening all the windows were enough to solve the problem. I don't know if you ahve a "home censer", they're popular e.g. in Serbia,with this censer it's easier to use incese.
As for the icons, it should be the east, but don't worry, if there is no possibility to install the icon corner in the proper place. It's a nice tradition, but not everybody has done it in such way. Eventually, the most important thing is the prayer before it.
