You can use any location for your overlays, but (as used above) /var/db/repos/<name> is probably more standard than /usr/local/portage. If you were still using /usr/portage you may want to migrate to the new (default) /var/db/repos/gentoo location too (and /var/cache/distfiles + /var/cache/binpkgs), but entirely optional.
ebuild location is fine, updating manifest that way is fine too (but "ebuild .. digest" is a synonym for "ebuild .. manifest" now). If you want to go all out you could also use repoman manifest

can update the entire overlay at once and perform QA checks, not that QA matters much for a private overlay but I do it anyway for good measure, I use it before submitting ebuild patches to gentoo maintainers too.
repos.conf is what replaces the need for PORTDIR and PORTDIR_OVERLAY, it just gets all the locations from there now (::gentoo included). I still like PORTDIR_OVERLAY for quick testing purposes though, but otherwise both should be removed from make.conf to avoid confusing portage (mismatching PORTDIR between make.conf and repos.conf been known to do strange things, fine if unset).