1). Yes send all passports (including the cancelled ones).
2). You need to send the Original Naturalization Certificate.
3). Yes, Passport Application Form (section 10 and 1 photo completed by your counter-signatory).
4). 2 photos in total (only one needs to be counter signed).
I would advise using the Post Office
check & send service . They will take £8.75 for checking your application form for any common mistakes and will also send your application via Special Delivery next day service. They will also take the Passport fee from you (so you can pay with any debit or credit card or even with cash).
If you pay the post office another £3 (or may be £3.5), then IPS will return your existing passport(s) and Naturalization Certificate via a Secure Courier (probably DX courier).
After submitting your passport application,
HMPO will return your Naturalization Certificate and existing passports within 10 days. Then in few days time, they will send you a letter with a reference number.
This letter will require you to call HMPO and book an appointment for the passport interview in your desired HMPO office. (if you are applying for your first adult passport).
Once you have attended the passport interview, your British Passport should arrive via a secure courier in few days time.
