Question one. You only have to have an external switch with a plug attached. You can build one easily with a 2 gang switch box with a scrap power cord. Plug that in, then plug the router into the socket. However, for safety's sake, you must unplug your router from this box whenever you change bits. You can also use a foot switch that's on/off. Not very expensive, but get one that defaults to off, and is momentary on - only on when depressed. Maybe $25 bucks, or find an old sewing machine foot switch in a used goods store and add a plug. Since you're using it to control a table mounted router, a simple switch, outlet, box and scrap wire with plug will do fine and cost maybe $8 or so. Use the wire and plug from an old computer power cord--may cost a buck....I'm not sure how the power part works - how do you add an external power switch to your router without messing with the controls built in?
I'll keep my eye out for a Katey-style jig at reasonable price (over here).
Question 2. As you check the junk and thrift stores, keep your eyes peeled for a smallish, sturdy table with a nice flat top. Find some sort of straight edge, for example an 18-24 inch steel ruler from a stationer's, and lay the edge on the used table, and move it around. If there are any areas that aren't flat, you'll see it as light peeking through the gap. If it's coated with laminate, that's even better. Four legs and reasonably tall and maybe $25 dollars and you have your router table. If the legs are short, attach longer extensions to the outside of the legs to raise it higher. Not pretty, but works. You can sometimes find old home bars, or kitchen stands that you can top with a sheet or two of ply and you're set.
I've even seen tables made of a couple of 24 inch squares of ply. A simple top, and cut the second square piece across the diagonal and use them to support the top. Use L brackets or pocket screws to assemble this and use several L brackets to attach this to studs in the wall--easy to space for stud locations, and space the triangular supports to a little wider than stud width so the L brackets can go into the studs. Don't need much to make this work for you. Put your power switch on the triangular piece. Using a double thickness of 3/4 ply, you can put 1 inch screws through the L brackets to assemble this. Simple and very cheap to build.
I'm enjoying your project by the way It's a challenge to figure out how to get the job done on the cheap. What you save on the table and fence goes to the jig.
Finding a used Katey jig may be tougher. So don't limit yourself to that brand. The Leigh jigs are excellent as well. If you're going to make some money from the hobby to pay for itself, you're going to have to add some tools, and this jig is one of them. People really like dovetail construction.
If there are no used jigs out there, you may have to buy one. In which case, I think your best bet is the Sommerfeld version, which includes the correct, high quality bits. Share this string with your spouse if it will help her understand how you've gone to great lengths to make the most economical decision. I also suggest you make sure you do projects for her, make things that help her out, or that she'd like. My wife shows her appreciation by being amenable to adding to my shop and tools.
I accumulated a really fine shop full of tools before I retired, which made it easier for me to pay for them. There are certain basic power tools that every shop requires. The minimum is a table saw, router, drill press and band saw. But if you buy something that's inadequate, you will need to replace it later. If buying as you go, you can keep your eyes out for bargains in the used market. Just don't get impatient.