Orientation of long thin rod on P3Steel v4
This is half of an answer. I have finally received an answer from my supplier, which says:


  Long thin rod is mounted as in the photo. I do not know what is a
  small hole.


So the small hole is still a mystery. 

Here is the photo that was included with the message (which confirms my placement, just not the orientation):





Update

As tjb1 points out in his comment, the hole can be clearly seen on the right hand side of the bar, in the eBay photo: